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Friday 20.07.2018 | Name days: Ramona, Ritma
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Lithuania’s political and economic diary. Lithuania to bolster defence budget by 30%

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Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RULithuania’s defence budget will steep by a whopping 30 percent in 2015, according to the country’s draft budget published on October 2.

In it, the assignations to the Ministry of National Defence amount to 424.5 million euro (over 1.465 billion litas), compared to 1.110 billion litas in 2014. But even at that level, the ministry’s budget will be just at a mere 1.11 percent of the GDP next year, considerably below the budgetary obligation to NATO, at 2-percent now.

The draft budget’s preamble states that next year’s budget has been drafted in response «to changing geopolitical and security situation in Europe and the need to fulfil NATO commitments».

Lithuanian politicians agreed to increase the country’s defence expenditure in response to Russia’s actions in Ukraine.

Defence Minister Juozas Olekas told the Lithuanian news agency BNS on October 2 that Lithuania «should carry out additional measures for the country’s security and its international commitments to the NATO Alliance».

80 Lithuanian Jews saviours granted status of freedom fighters

Jews’ saviours have been rewarded certificates testifying their legal status as participants of freedom fights. The ceremony this week included words of gratitude and critical remarks to the government for delays.

Gintaras Šidlauskas, senior specialist at the Lithuanian Genocide and Resistance Research Centre, expressed regret that over four years of delayed decisions many rescuers simply died of old age.

«To be exact, about 180 rescuers were still alive four years ago, and today there are just over 100 left,» Šidlauskas said at a ceremony in Kaunas.

The Lithuanian Jewish Community’s leader Faina Kukliansky has said she herself comes from a rescued family, adding that rescuers deserve more appreciation – in her words, monuments should be built to honour the rescuers, with schools and streets named after them.

The legal status has been granted to 80 rescuers of Jews, including seven post-mortem. They have been allocated a second-degree monthly state pension of 400 litas (115.9 euro) as of 1 October.

In June, the parliament adopted amendments on the legal status of freedom fighters to rescuers of Jews and a state pension.

The government had initially proposed to the Seimas to postpone the adoption of the amendments due to the a lack of funds but were forced to change their minds after coming under fire from the public citing the Cabinet’s decision to raise wages politicians and civil servants.

During World War II, the Nazis, often assisted by their Lithuanian collaborators, massacred about 90 percent of the pre-war Jewish population of more than 200 000.

Lithuanian ministry suggests getting rid VAT exemptions for heating

The Lithuanian Ministry of Finance has proposed to scrap VAT exemptions for district heating, asserting that a draft state budget for 2015 allots sufficient funds to compensate low-income families for increased heating bills.

Heating is currently taxed at 9 percent, well below the standard rate of 21 percent.

In planning next year’s budget revenues and expenditures, the ministry took into account that the existing VAT exemption for heating expires at the end of this year and, therefore, earmarked additional funds for local governments to pay compensation to low-income families, Finance Minister Rimantas Šadžius said in a press release.

The reduced VAT rate for district heating sparks discussions each year and the economists continuously call to scrap it and, accordingly, to generate more budget revenue.

Finance Minister, Parliament Speaker Loreta Graužinienė and some other politicians have said that the reduced rate is not fair in social terms and, therefore, should be abolished, in particular as the prices of natural gas and electricity are going down.

The standard VAT rate in Lithuania is 21 percent. Until the end of this year, district heating is subject to the reduced 9-percent VAT rate.

Lithuanian Government ponders idea of «Institute of Lithuania»

The Lithuanian government is mulling setting up an institution that would be tasked with the promotion of Lithuanian culture abroad. The Cabinet’s Strategic Committee has deliberated the issue this week.

«It was decided to set up an inter-institutional group that would submit proposals on the issue and choose the best option,» Antanas Martusevičius, head of the Cabinet’s Press and Communication Division, told BNS.

If established, it would «coordinate the presentation of Lithuanian culture in the world».

Air Lituanica strikes deal with Air France and KLM

Air Lituanica, a Vilnius-based airline, controlled by the Vilnius Municipality, has signed a cooperation agreement with Air France and KLM Royal Dutch Airlines for connecting flights to Paris and Amsterdam.

«What is very important for us is that we will be able to use the extensive ticket distribution channels of these carriers and offer their services to our passengers,» Air Lituanica Commercial Director Simonas Bartkus said in a press release.

The cooperation is said to have potential of bringing other benefits in the future, such as the possibility of using Air France and KLM loyalty programs.

According to the press release, passengers will be able to buy one ticket for a flight from Vilnius with an intermediate stop in Amsterdam Schiphol Airport or Paris Charles de Gaulle Airport, from which KLM and Air France operate 231 routes to 103 countries.

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