The governor of the central bank said inflation is rather high and essentially all EU member states took steps to mitigate its effects, whereas the degree of the measures may vary and opinions about them may be mixed.

“Our position is very clear – fiscal discipline must be followed, new measures must not contribute to even stronger inflation processes,” Šimkus said.

The head of the Bank of Lithuania stated that steps aimed at mitigating the effects of inflation should not be wide-ranging and, instead, should be targeted at those who need them the most, i.e. the most vulnerable members of society.

“Therefore, for example, VAT relief, tax reduction is not a suitable measure because it is a very broad measure, which would benefit both those who earn income and those facing difficulties. It is much better from the societal standpoint to limit resources of our country and direct them at those who need help the most at this difficult time,” he said.

As reported, the opposition recently demanded to adopt its “anti-inflation” proposals: reduce VAT on food and district heating, lower excise duties on fuel and equate the tax-exempt amount of income to the minimum monthly salary. Although the proposals were rejected in parliament, opposition MPs vowed to come up with new proposals in the summer.

It is forbidden to copy the text of this publication without a written permission from ELTA.
Elta EN
Comment Show discussion