Lithuania will not introduce progressive taxation because there are too few high-earners, according to the country's social democrat Prime Minister Algirdas Butkevičius.
Algirdas Butkevičius
© DELFI / Karolina Pansevič

"At this point, it is impossible, because there are only several tens of thousands of people making very big salaries," Butkevičius told the business daily Verslo Žinios.

Lithuania currently has a flat personal income tax of 15%, although deductions for lower-income earners apply.

Butkevičius said that progressive taxation would disadvantage the middle class.

"If we introduced progressive tax, disposable income of the middle class would be cut. In order to have low-earners feel a real rise in their income, we have introduced some progressivity through tax deductions which were raised this year," Butkevičius said.

This January, the tax-exempt minimum level of income was raised from €166 to €200. Additional exemption for parents with small children was raised from €60 to €120.

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