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Wednesday 29.01.2020 | Name days: Valērijs, Aivars
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2020 starts with slew of changes in Lithuanian life

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Vilnius, Lithuania, taxation, chid benefits, economy

Linas Jegelevičius for the BNN

The New Year in Lithuania has ushered in many key changes in nearly every field of life. The keenest observers counted at least three dozen novelties in taxation, education, health and salary and pension systems. BNN lists below just the most vivid changes.

Minimum wage

The minimum monthly wage from January 1 will steep by 52 euros from 555 to 607 euros before the deduction of taxes, bringing the take-home pay from 396 to 437 euros. Around 156,000 people in Lithuania make the minimum wage or less, the statistics says.

Pensions and salaries

With pension indexation being pegged in 2020 to growth of wages, pensions this year will grow more than 8 per cent as of January 1. The average monthly old-age pension will reach 377 euros in the new year, and it will amount to 399 euros for seniors with mandatory working experience. The basic pay rate for civil servants will edge up from 173 to 176 euros, meaning that around 300,000 state officials and civil servants will see their pay rise.

Child benefits

Child benefit payments in 2020 will go up from 50 to 60 euros, and from 70 to 100 euros families raising three of more children, also for low-income families and those raising disabled children.

Income tax

Lithuanians making over 110,000 euros a year will see their income tax rate go up from 27 to 32 per cent. There are over 2,000 top-earners in Lithuania who will be affected by the change, according to statisticians.

Real estate tax

Owners of real estate valued more than 150,000 euros will have to pay real estate tax which until now was applied to properties of over 220,000 euros. Seventy-five percent of the properties are believed to be in capital city Vilnius. The Lithuanian government expects to add to the state coffers around 2.5 million euros in additional tax revenue.

Fuel excise duties

As a result of the growing fuel excise duties, the price of petrol will go up by around 0.04 euro per litre. The diesel fuel excise for farmers will increase from 56 to 60 euros per 1,000 litres, making one litre of diesel roughly 0.005 euro more expensive.

Daily allowances

Starting January 1, 2020 business trips will be affected. Calculating the non-taxable daily allowance for foreign business trips, fixed salary of an employee will be compared with the minimum monthly salary or the minimum hourly salary multiplied by a coefficient. The coefficient increases from 1.3 to 1.65 from the year. The amendment eliminates the possibility of increasing daily allowance rate of foreign business trips for director of the company up to 100 per cent.

Conscription age

Starting January 1, 2020, the age range at which men are called up for mandatory military service is lowered to 18-23 years, from 19–26 years currently. The amendments of Law on Conscription also bars volunteer soldiers from holding seats in the parliament and municipal councils.

Stocks

Under new rules in force from February 1, the value of shares vested under stock options not earlier than three years after date of grant will be tax exempt. The main purpose of the changes is to create an additional non-taxable benefit for employees receiving stock options.

Alcohol price goes up

Due to the higher excise tax, the average price of the bottle of alcoholic beverage will go up roughly 0,45 euro from March 1.

More expensive electricity, cheaper gas

The price of electricity will increase 15 per cent for Lithuanian households from the New Year. Meanwhile, gas will be cheaper around 17-22 per cent in 2020.

Changes in education system

At least seven key changes will affect Lithuania’s education system this year. Upon agreement with  major Education trade unions, teachers’ base salary will increase 10 per cent, year-on-year, from September 1, 2020. Practically, the average teacher’s pay is expected to go up around 100 euros. Meanwhile, pre-school educators can expect up to 300-euro higher salaries.

Additional class of physical education

Starting September 1, Lithuania’s seven graders will see an additional class of physical education added to their curriculums. First graders and sixth graders have been more sweating in additional physical education classes from last September.

Admissions to vocational schools

Students to Lithuania’s vocational schools will be admitted not only during summer, but in winter too – the first stage of admissions will be organised in early February. This change is thought to help high school drop-outs to choose the path of vocational training.

More state-supported slots in high schools

Lithuania has allotted this year additional 4 million euros to increase the accessibility of state-supported slots for students in the country. Implementing the university optimisation plan, Siauliai University will be merged with Vilnius University in 2020.

New compensation system for patients

From now on, patients who were mistreated in Lithuanian medical facilities, will be able to sue them three years after the damage was done. Thus, the period of damage claim has been extended.  Pecuniary compensations will be paid from the medical facility’s account. Until now, insurance funds paid them.

More transparency in pharmaceutical industry

Starting January 1, 2020, pharmacy companies and their representatives are obliged to inform the State Medicine Control Service (VVKT) what support in the form of gift coupons, free medical events abroad and et cetera they have provided to medics. This kind of information will be accessible to all on the VVKT website.

Higher requirements for stroke diagnostics

New orders by the Health minister, Aurelijus Veryga, obligate ambulances to bring patients with suspected stroke within one hour since the placement of phone call to the emergency room.  Meanwhile, tomography must be performed withing 30-60 minutes since the arrival of the patient.

Changes to Lithuania‘s Eurovision 2020

Lithuania’s national broadcaster LRT which organises Eurovision Song contests in the country, has announced that the 2020 national selection will last for six weeks – from early January until mid-February, nearly two months than until now. Besides, one artist will be allowed to compete with one song only, the jury will be present, however, they will watch the performances in a separate studio, and will not provide comments after each of the performances; televoting results will not be shown during the show as it was the case until now. They will only be shown at the end of the show.


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