PM: "a lot of exceptions" made to tax changes for farmers

As part of the farming community prepares to protest against the tax changes being debated in the Seimas, Prime Minister Gintautas Paluckas assures that some of the farmers' demands have been taken into account, a number of exceptions have been made, and compromise solutions have been adopted. 

„I believe that everyone should pay taxes. And for the agricultural sector, there are certainly a lot of exceptions, some compromise solutions have been adopted, which we will implement in the framework of other laws as well," Paluckas told reporters at the Seimas on Monday.

The Lithuanian Association of Grain Growers, together with the Farmers' Union and the Agricultural Council, announced on Monday that a protest against the tax reform is to be held on Thursday at the Seimas, with about 500 participants and 100 tractors expected to arrive.

Farmers oppose changes to the personal income tax (PIT), the law on state social insurance (SSD), and road taxation.

The protest organisers, among other things, are asking for the GPT to be applied to them on the basis of their three-year average taxable income, as farmers' incomes fluctuate from year to year due to natural conditions and market fluctuations.

According to Mr Paluckas, this request will be taken into account: „Because in agriculture, it often happens that one year is great and the next one is a little bit worse, and that is why it is necessary to balance the tax that is being paid, which is a European practice.

The Prime Minister said that the farming community is expressing its demands in a constructive way. 

„Farmers are certainly not outraged, they are first and foremost expressing their position and they are expressing it in a very constructive way. Both in the form of proposals and, well, in a kind of democratic form – a picket“, – said G. Paluckas.

„We haven't seen tractors in Vilnius for a long time, so we will do it again“, – added the Prime Minister.

As BNS wrote, the government's initiative to increase the progressivity of the GPT by introducing a new 25 per cent rate (from 36 to 60 GPU) in addition to the 20 per cent (up to 36 VDU) and 32 per cent (above 60 VDU) rates, including for individual activities, and taxing all types of income except dividends and royalties (which would remain at a rate of 15 per cent) is on the way to be introduced at the Sejm.

The proposed tax changes also include taxing some insurance contracts at 10%, raising corporate income tax by 1% point to 17%, changing the preferential rates of value added tax (12% instead of 9%), abolishing the heating tax, and introducing a "sugar tax".