The Seimas approves significant amendments to the Laws on Profit and VAT!
Changes to corporation tax:
Corporate tax rates are increasing:
- 6% → 7% for small businesses, cooperatives and profits from R&D assets.
- 16% → 17% in all other cases.
- For new small businesses , 0% for two years (previously only for the first year). New: when determining the size of a company, the number of employees will no longer be taken into account, only the income.
Scholarships become part of the restricted deductions if they are paid to students in STEM* fields.
Fixed assets can be written off immediately as an expense (when the asset is used in the activity for ≥3 years, without the investment project allowance).
No need to get permission from the tax authorities to change the depreciation rate.
Difficulties in transferring losses between group companies (stricter shareholding and holding period requirements, limiting the amount of losses that can be transferred to 70%).
VAT changes:
The 9% rate is abolished:
21% VAT will be applied to heating and firewood.
12% VAT rate applies:
For accommodation, passenger transport, attending cultural events (where no VAT relief applies).
5% VAT rate applies:
Printed and electronic books, non-periodicals (excluding advertising/image/music content).
