bnn.lv Latviski   bnn-news.com English   bnn-news.ru По-русски
Sunday 15.12.2019 | Name days: Jana, Johanna, Hanna
LithuaniaLithuania

Lithuania opposition MP: «The ruling majority muddles through a «foxy» budget»

FaceBook
Twitter
Draugiem
print
(No Ratings Yet)

Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RU

Linas Jegelevičius for the BNN

For the fifth consecutive year, Lithuania’s new budget, now for 2019, is described as «record» due to the size of surplus and the hefty allocations to education, health care, innovations and reduction of social inequality.

Finance Minister Vilius Šapoka touts it for being oriented to «strategic goals» of the state, whereas the opposition suspects that behind the generosity stands the coming elections to municipal Councils, the European Parliament and President’s Office, all due in the spring.

«The budget is likely to be approved by the ruling majority, however the draft raises many questions to many. It seems to me it is part of the ruling Farmers and Greens’ vehement self-advertising campaign, yet it little addresses the reality. The growth of salaries in many sectors is based on redistribution of the resources, that’s how it is,» Linas Balsys, a MP from the Lithuanian Parliament opposition, told BNN.

«It is ambiguous to speak about raise of cultural workers’ salaries after the Finance Ministry sent letters to many cultural organizations exhorting them to cut their expenses by 15 per cent,» reminded. «The ruling majority muddles through a «foxy» budget», he added.

According to the budget draft, the state budget’s revenue is set to rise 19.7 per cent, or 1.516 billion euros, to 10.587 billion euros, and expenditure will increase 22.2 per cent, or 2.121 billion euros, to 11.681 billion euros. The state budget’s deficit will stand at 1.095 billion euros, up 2.2 times, or 605.369 million euros, from this year’s planned deficit of 489.171 million euros.

The government’s total tax revenue is expected to grow by 30.1 per cent next year compared with this year to 8.019 billion euros. The value-added tax (VAT), the largest single source of tax revenue, should increase by 8.8 per cent to 3.85 billion euros.

To translate the numbers into the real-life picture, the minimum wage should go up by 30 euros to 430 euros and the average pension by nearly as much in 2019, child benefit, introduced in 2017, will increase from 30 euros to 50 euros per child under 18. The latter measure will require an additional 120 million euro from the budget and the indexing of pensions – another 220 million euro.

The financing of health sector is set to increase by 280 million euros, education sector will be allocated 185 million more, year-on-year, with the bulk of money to be used for salaries of teachers and scholars.

When summing up the budget, Lithuanian Prime Minister Saulius Skvernelis, called it «socially responsible» and said it will help «improve the quality of life» for a large part of the population.

«Importantly, the budget provides for the structural reforms approved by the government and the Seimas. These are education, social protection, health and innovation reforms and other important things aimed at achieving an improvement in the quality of life and income growth for our people. This is a socially responsible budget,» he emphasised.

The fast rise in budget revenue and expenditure is related to the planned tax overhaul (the consolidation of taxes on the employee’s side), as well as the transfer of the funding of the general part of the social insurance pension to the state budget, he insisted.

Differently from this year’s national budget ,which focuses on the lowest-income people, next year’s budget is oriented toward broader population groups, the PM noted.

«Quite a large amount of money, more than 600 million euros, is allocated for working population, including each of us. We focused on people on the lowest income in this year’s budget, but (next year’s budget) covers the so-called middle class as well,» said Skvernelis, who is expected to run in the presidential election under the flag of the ruling Farmers and Greens next year.

«In addition, we’ll form a reserve of more than a billion euros and we’ll have it in place as early as next year in case, God forbid, a crisis should occur someday. We’ll have a surplus budget and we’ll strictly adhere to financial discipline,» he said.

The Government head says that taxes for the employed will be reduced by 6 per cent over the next three years, a result of the tax overhaul.

«Our aim is to create and maintain 26,000 new jobs and spread the word about Lithuania as the Baltics’ most competitive country in terms of labour taxes,» Skvernelis underscored.

Although Finance Minister Vilius Šapoka estimates that the country’s budget surplus will stand at 0.6 per cent GDP next year, the exact numbers can be adjusted in the fall. The Minister also pointed out that the Cabinet «took into account» and «reflected» the ongoing international developments in finance markets when drawing up the budget.

«We have to acknowledge that the growth of world economy is slowing down and the growth is not stable and even any longer. And the Lithuanian economy is not an exception from the whole picture. Although we aim at a record-large new budget, we are accumulating throughout monetary reserves. The 2008 crisis has taught us a valuable lesson,» Šapoka said.

According to him, Lithuania aims to accrue 1,5 billion euros in reserves by the end of the next year.

Disagreeing with the Minister claiming that the new budget is a reflection of «structural and strategic reforms» being carried out by the Government, Ingrida Šimonytė, a Conservative MP and former Finance Minister in the 2008-2012 Conservatives-led Cabinet, lambasted Šapoka and claimed she «cannot» remember «a single reform» carried out by the Government.

«I really do not recall any. Perhaps the minister refers to the overhaul of teachers pay, which is merely dragging of the blanket from one teachers to others. We call it redistribution of resources, to employ the economic terms,» Šimonytė said.

«And I do not also understand why, for example, the indexing of pensions the Cabinet is also called «a reform». The laws envision indexing, so what are we here talking about?» the former Finance Minister wondered.

Justas Mundeikis, economist and lecturer at Vilnius University, also questions how the Cabinet is going to meet the budget targets.

«From what I see, two sources are foreseen for that. The first is from the growth of economy and the other is from the reducing of the shadow economy. Indeed, we can plan growing of the economy, not reduction of shadow economy,» he told BNN. «Thence a big risk that we can stumble upon the road and fail to collect the budget as we wish,» he added.

Although the Cabinet said it didn’t mull any new taxes in the new year, however there are rumours that the position may change with a gap in the budget.

Introducing higher tax for strong ale, a new tax for car owners and real estate owners has been among the raised ideas on the Lithuanian Parliament (Seimas) floor this year.


Leave a reply

Aivars Lembergs leaves his post in Latvian Olympic Committee

On Friday, 13 December, individual member of Latvian Olympic Committee and member of its Executive Committee Aivars Lembergs announced to LOK board his decision to leave the organization, BNN was told by LOK press-secretary Mārtiņš Mālmeisters.

Ralfs Kļaviņš and Edvīns Bērziņš leave the board of Latvian Transit Business Association

Chairman of Riga Commercial Port Ralfs Kļaviņš and ex-chairman of Latvian Railway Edvīns Bērziņš have left the board of Latvian Transit Business Association, according to information from Firmas.lv.

US sanctions will not affect companies in which Lembergs no longer has any influence

The sanctions introduced by USA against Lembergs will not affect the companies over which he no longer has control thanks to a ruling of the court.

Liquidation of discount fares on multiple RMS routes would help save money for Rīgas satiksme

By liquidating multiple discounts for passenger fares on multiple LLC Rīgas mikroautobusu satiksme routes, LLC Rīgas satiksme public transport company hopes to save approximately EUR 1.75 million a year.

Tallinn region GDP portion decreases in Estonian economy

In 2018, 65% of the Estonian gross value added was created in Harju county, while the rest of the country is inching closed with Harju county, the official statistics of the Baltic country showed.

EU prolongs targeted sanctions against Russia over Ukraine

The European Union has extended for another six months its sanctions against Russia’s energy, finance and military sectors. The continued restrictive measures are said to remain in full until Minsk peace deal is implemented.

Local government representatives will no longer work at Riga and Ventspils freeport

Following the coming into force of amendments to the Law on Ports, representatives of Riga City Council and Ventspils City Council will lose their respective posts in the board of Riga Freeport and Ventspils Freeport, the law states.

Total tax debts in Latvia at December’s beginning – EUR 869.4 million

At the beginning of December, total tax debts in Latvia, including outstanding, halted and extended debts, were equal to EUR 869.367 million, which is 1.9% less than a month prior, according to data from the State Revenue Service.

In UK’s Brexit election, Conservatives win comfortable majority

In the British snap parliamentary election aimed at breaking the Brexit impasse, the ruling Conservative Party has won gaining a comfortable majority, according to close to complete results.

Riga City Council’s interim administration may be entrusted to VARAM state secretary Balševics

If the Saeima votes in favour of dismissing Riga City Council, the interim municipal administration may be entrusted to Environment Protection and Regional Ministry’s state secretary Edvīns Balševics, according to the ministry’s Riga City Council dismissal legislative draft to be decided on by the government on 17 December.

EU member states commit to 2050 carbon neutrality, Poland opts out

European Union’s 26 members, including the Baltic states, have supported the planned political course to considerably reduce the greenhouse gas emissions to net-zero by 2050. Coal-powered Poland said it could not reach the goal and opted out.

Latvia’s prime minister forms a work group to ensure Ventspils Freeport’s operations

On Thursday, 12 December, Latvia’s Prime Minister Krišjānis Kariņš has issued an order on formation of a work group under Transport Minister Tālis Linkaits in order to ensure undisrupted operations at Ventspils Freeport, as reported by the prime minister’s press-secretary Sandris Sabajevs.

Ministry: to prevent damaging Latvian sports sector’s reputation, Lembergs should leave LOK

To avoid letting US sanctions negatively affect Latvian Olympic Committee and spread to the reputation of the country’s sports sector, the ministry can only ask Aivars Lembergs step down as member of LOK Executive Committee, BNN was told by Education and Science Ministry.

Budget Committee declines residents’ request to postpone increasing funding for parties

Saeima’s Budget and Finance Committee has rejected a public initiative signed by more than 11 000 residents. This initiative requested postponing the planned increase of funding for political parties.

Lower election threshold in Lithuania – more democracy or chaos?

The Lithuanian legislature, Seimas, has lowered this week the parliamentary election threshold to 3 per cent for political parties and 5 per cent for coalitions.

Russia expels German diplomats, retaliating to German step over Berlin murder

Russia has asked two diplomats of the German Embassy to leave the country. This is a tit-for-tat measure after Germany declared two Russian diplomats personae non grata as Berlin investigates an international murder in the German capital, TASS reported.

Riga Freeport and Liepaja Special Economic Zone to leave LTAB

Riga Freeport and Liepaja Special Economic Zone will leave Latvian Transit Business Association managed by Aivars Lembergs, as both are subjected to US sanctions.

Lembergs’ influence over Ventspils Freeport needs to end, bank supervisors say

The goal of the US sanctions is reducing Aivars Lembergs’ economic and political influence over Ventspils Freeport and other companies under his control. Sanctions are not meant to paralyse companies, rather seeing how they are used to process deals influenced by the person under sanctions – Aivars Lembergs, said Finance and Capital Market Commission head Santa Purgaile during a press-conference on Thursday, 12 December.

USD 25 million offered in Weinstein sage to 30 alleged sexual abuse victims

In the U.S. movie industry scandal surrounding sexual abuse claims against film producer Harvey Weinstein his lawyers have offered a USD 25-million settlement to more than 30 women, The Guardian reports.

Legal Affairs Committee supports lifting judge immunity for administrative violation cases

Saeima’s Legal Affairs Committee supported prior to the second reading legislative drafts to the Law on Judicial Power and Law on Judges Disciplinary Liability intended to lift the immunity of judges in administrative violation cases, as confirmed by Justice Ministry.

Estonian-Finnish gas interconnection unveiled

Estonia and Finland have held ceremonies to unveil the gas pipeline Balticconnector, built to connect the gas transmission networks of both countries separated by the Baltic Sea.

Mārtiņš Kazāks officially becomes governor of the Bank of Latvia

On Thursday, 12 December, Latvia’s Saeima officially approved Mārtiņš Kazāks as the new governor of the Bank of Latvia, as BNN was told by Saeima’s press-service.

What is Ventspils Development Agency and what will its members do now?

Among the organizations against which US Department of Treasury Office for Foreign Asset Control has adopted sanctions is also Ventspils Development Agency. In accordance with OFAC issued Global Magnitsky General Licence Nr.1, global partners have 30 days to cease all cooperation with this organization.

Israel on way to third parliamentary election in year

Israeli legislators have been unable to overcome a prolonged political crisis. The Knesset has given its initial approval to the third parliamentary election in the Middle Eastern country in a year’s time after legislators proved unable to form a majority coalition.

Social Integration Fund torn over NGO support priorities

Although sides of the Social Integration Fund have argued over priorities of the Non-Government Organizations Fund, the contest to start using funding allocated to NGOs may yet be announced this year, allows Social Integration Fund council member and Prime Minister Krišjānis Kariņš’s representative Imants Parādnieks.


Do NOT follow this link or you will be banned from the site!