Banks to pay solidarity levy for one more year: the Seimas gives the green light, announces how much it is expected

On Tuesday, the Seimas approved a proposal to extend the bank solidarity contribution for one year.

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Jun 18, 2024, 4:38 PM

The tax extension is expected to generate €60 million for defence purposes. At the adoption stage, 110 voted in favour of the bill, ten abstained, and 1 MP voted against it.

Mindaugas Lingė, Chairman of the Seimas Budget and Finance Committee (BFK), pointed out that the decision was necessary due to the continuing exceptional circumstances.

„This decision is not very pleasant because we had defined the interim period as two years, but the exceptional circumstances continue, and the contribution from the banking sector to the strengthening of defence is necessary and meaningful,“ Lingė told the Parliament's plenary sitting on Tuesday.

However, Liberal Andrius Bagdonas opposed the decision, stressing that the extension of the solidarity levy sends a bad message to businesses operating in the country.

„Today, we are taking more money from one business sector with unplanned income over and above what it had planned (...) and calling it solidarity. (...) I think we are acting irresponsibly and creating precedents in the country that send a terrible message to businesses operating in Lithuania,“ Bagdonas said.

Earlier, Eivilė Čipkutė, President of the Association of Lithuanian Banks (LBA), said that she did not understand why banks had to pay more than other large businesses.

According to her, no other sector, which periodically receives higher income due to external conditions, is subject to such taxation.

Elena Leontjeva, President of the Lithuanian Free Market Institute (LLRI), also disagreed with the politicians' ideas, arguing that extending the bank solidarity levy for another year sets a dangerous precedent and dashes the dreams of foreign banks coming.

However, the proposal to extend the bank solidarity levy is supported by the country's President Gitanas Nausėda.

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