At noon, the protesters gathered in Vincas Kudirka Square with posters saying that tax hikes increase the shadow economy. Symbolic cemetery candles and flowers and Latvian and Estonian flags were seen lined up outside the Government house.

The Lithuanian Association of Hotels and Restaurants (LVRA), one of the organisers of the protest, said this is the first ever joint action by the hospitality sectors in the Baltic States that was prompted by the "irresponsible policies of all three countries."

The LVRA urges politicians in Lithuania and other countries to follow the example of many other European Union (EU) countries. It emphasises that 21 of the 27 EU countries have been applying a reduced VAT rate since 2009, while Lithuania is the only one to increase its VAT rate to 21% in January 2024.

Head of the LVRA Evalda Šiškauskienė said the protesters are asking the newly elected government to set a 9% VAT rate for catering services indefinitely.

"Today we are here to draw the attention of the incoming elected government to correct the previous government’s mistake and to place us back in the European context by bringing back the reduced 9% VAT rate," Šiškauskienė told ELTA on site.

According to her, 80% of the catering sector are not some luxury restaurants, but school canteens, kindergartens and retirement homes, which "politicians are not inclined to talk about before the elections".

The organiser said that catering firms are operating at "virtually no profit", with a profitability of 0.17%, which can only last "as long as suppliers who are not being paid for their goods have the patience".

Šiškauskienė added that a round of talks with politicians is planned after the protest.

Protesters also rallied in Estonia and Latvia, and in Lithuania protests are also taking place in other three cities – Kaunas, Klaipėda and Palanga.

More than 500 catering firms have gone bankrupt in the last six months, Šiškauskienė had said earlier.

The Parliament eliminated reduced rate VAT of 9% for restaurants, cafés and similar catering companies as of 1 January 2024.

The Ministry of Finance estimated that the standard rate VAT for catering companies would bring additional EUR 140 million to the state and municipal budgets.

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