The Seimas of Lithuania has extended the existing temporary bank solidarity levy for another year. Respective amendments to the Law on Temporary Solidarity Contribution were adopted in a vote of 110 to one with 10 abstentions.
Presenting the amendments, Finance Minister Gintarė Skaistė said the banks are projected to see record profits for another year, which warrants the extension of the so-called solidarity tax.
The Bank of Lithuania estimates that the levy could raise 50 to 70 million euros next year compared to 256 million euros in 2023 when the tax was first introduced.
The contribution for 2025 will be calculated based on the net interest income for 2019–2022, just as it was done for 2024.
The government introduced the tax in response to windfall profits enjoyed by the banks in Lithuania thanks to the interest rate hikes by the European Central Bank. The proceeds are to be used for defence infrastructure.
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