Lithuania should consider expanding the real estate tax base, Vitas Vasiliauskas, board chairman of the central Bank of Lithuania, says, doubting, however, such changes could be adopted during the existing "political cycle."
Gyvenamųjų namų projektas Baltupiuose
Gyvenamųjų namų projektas Baltupiuose
© Bendrovės archyvas

"We submitted our proposals on expanding the base (of the real estate tax – BNS Lithuania) last year. We perfectly realize that we could hardly speak about expanding the base during the existing political cycle. But the central bank is a marathon runner and our mission is to regularly repeat things which we find important. (…) We hope to get back to these proposals during the next political cycle," Vasiliauskas told a press conference on Tuesday.

In his words, the International Monetary Fund and European Commission have also made suggestions to Lithuania on the real estate tax, and the tax itself would increase the state's income and their redistribution.

"A real estate tax is in principle a neutral tax, it’s the least damaging and can be administered in the easiest possible way, therefore, it's an additional source of revenue. Having in mind our redistribution level, I believe it would be a fairly good thing to have it as classic. But that's already the prerogative of the executive government," Vasiliauskas said.

He did not provide any details on possible changed to real estate taxation but underlined that it should be expanded.

"I don't want to go into details but it should be a wider base covering in principle residential real estate and having differentiated rates based on the value of real estate. So, I'd say, the axis should be like this. But we need to have agreement first. It's fairly difficult to discuss this at this stage," Vasiliauskas said.

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