Seimas Approved Draft State Budget and Municipal Budgets for 2008

Vilnius, December 6. Today, the Seimas of the Republic of Lithuania approved draft State budget and municipal budgets for 2008. It is envisaged that next year the national budget covering the State budget and municipal budgets, including EU budget funds, will receive LTL 29.4 billion, and it is by LTL 7.2 billion more than in the current year, while expenditure will be LTL 6.8 billion or by 28.8 percent more than in this year and will make up LTL 30.4 billion.

The major part of revenue planned to be generated to the national budget for 2008 will be gained from the value added tax – LTL 101,64.1 million or about 41.8 per cent of total national budget revenue. LTL 5,430.2 million, or about 22.4 per cent of total revenue – from the personal income tax.

Next year it is planned to collect LTL 3,520.2 million or about 14.5 per cent of total revenue to the national budget from excise duties. As of January 1, 2008, after increase in excise duty rate on fuels, and as of March 1 – excise duty rate on cigarettes, it is envisaged that the State Budget will additionally receive LTL 177 million. As of January 1, after increase by 10 per cent in excise duty on beer, and on alcohol – by 20 per cent, the budget will receive LTL 190 million.

Next year from the corporate income tax it is planned to gain about LTL 2,711.1 million, and it will represent 11.2 per cent of total national budget revenue.

As of January 1, 2008 the temporary social tax will be abolished. According to the estimations by the Ministry of Finance, due to this, the national budget will loose LTL 400 million of revenue. As of January 1, after reduction of the personal income tax rate down to 24 per cent (at present – 27 per cent), over 2008 the national budget will loose about LTL 566 million.

In 2008, LTL 231 million of revenue from taxes on international trade and transactions is planned to be collected to the national budget.

In 2008 the State budget revenue, including the EU assistance, will make up LTL 25.6 billion, and it is by 33.1 per cent more than it is planned to gain in the current year. Next-year State budget expenditure will be by 28.7 per cent higher than this year and will amount to LTL 26.6 billion. The draft envisages that next year Lithuania will receive LTL 5,112.8 million from the EU budget, and Lithuania’s contribution to the EU budget will make up LTL 1,050 million.

It is planned to allocate LTL 2,784 million from the State budget for 2008 for social security, and it is by LTL 782 million more than in the current year.

In the draft State budget it is envisaged to allocate to education, including higher schools, LTL 2,692 million, or by LTL 131 million more than in the current year.

For health care, including State budget appropriations allocated to the budget of the Compulsory Health Insurance Fund, it is planned to designate in total LTL 1,656 million or by LTL 340 million more than in the current year.

For recreation, culture and religion it is planned to allocate LTL 717 million, and it is by LTL 151 million more than in the current year.

For public order and public security it is envisaged to designate LTL 2,399 million, or by LTL 771 million more than this year.

In the draft State budget it is planned to allocate to the national defence LTL 1,494 million, and it is by LTL 207 million or by 16.1 per cent more than in the current year.

It is projected that next year the revenue of municipal budgets will make up LTL 6,468 million. As compared to the year 2007, it will be larger by LTL 1,254 million or by 24.1 per cent.

The municipal budgets plan to allocate LTL 3,697 million for education, of which – LTL 1,748 million or by LTL 243 million more than in the current for financing of the student’s basket. In 2008, LTL 141 million is planned to be allocated from municipal budgets for health care, LTL 674 million to social security.

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