Lowering the value-added tax (VAT) rate for all goods and services would be preferable to exemptions on select products, like food, Lithuania's Finance Minister Rimantas Šadžius.
Rimantas Šadžius
© DELFI / Mindaugas Ažušilis

"I would not like to see the budget losing a chunk of revenue, which would inevitably happen if we suddenly cut VAT rate for a group of good," Šadžius told Žinių Radijas on Thursday. "The same could not be said about cutting the overall VAT rate. Sure, it would affect budget revenues in some way, but we need to look into whether the effects of gradual VAT lowering would not be outweighed by resulting economic growth."

The Lithuanian parliament is considering a bill on cutting VAT rates on staple foods from the general rate of 21% to 5%.

Meanwhile Prime Minister has said he does not agree with exemptions on select goods, but suggested instead cutting the general rate to 18%.

Social Democrat MP Arvydas Mockus, member of the Economy Committee, drafted a bill to that effect this week.

Nauseda: everybody thinks about plan B despite Brexit deal

The European Union is weighing all options of possible action if the British parliament rejects the...

Nauseda: EU will approve Brexit deal, doubts remain on UK parliament

EU leaders will likely to smoothly approve the recently-reached Brexit deal on Thursday but doubts...

Cabinet approves new car pollution tax

The Lithuanian Cabinet approved on Wednesday a new tax aimed at encouraging people to buy less...

Alcohol, tobacco and diesel fuel excise tax hikes approved

The Lithuanian Cabinet decided on Wednesday to raise the excise duties on strong alcohol , diesel...

President proposes new measures to block Astravyets electricity

Lithuanian President Gitanas Nauseda on Wednesday proposed new measures to block imports of...