Eurofound's EU PolicyWatch collates information on the responses of government and social partners to the COVID-19 crisis, the war in Ukraine, rising inflation, as well as gathering examples of company practices aimed at mitigating the social and economic impacts.
Factsheet for measure LT-2021-26/1956 – Updated – measures in Lithuania
|Country||Lithuania , applies nationwide|
|Time period||Temporary, 22 June 2021 – 31 December 2023|
|Type||Legislations or other statutory regulations|
Supporting businesses to stay afloat
– Direct subsidies (full or partial)
|Author||Inga Blaziene (Lithuanian Centre for Social Sciences) and Eurofound|
|Measure added||12 July 2021 (updated 12 March 2023)|
On 22 June 2021, the Seimas of the Republic of Lithuania adopted Law No XIV-429 Amending Article 19 of Law No IX-751 on Value Added Tax of the Republic of Lithuania, introducing a provisional reduced VAT rate of 9% for the catering and cultural sectors to be effective until 31 December 2022. According to the initiators of the amendments to the VAT law, the main purpose of this measure is to help the catering and cultural sectors that have been hit hard by COVID-19 and have been unable to provide services for a long time due to lockdown-related restrictions.
The amendments to the law stipulate that the reduced VAT rate of 9% will be applied to:
These amendments to the law came into force on 1 July 2021 to be effective until 31 December 2022. The standard VAT rate in Lithuania is 21%.
The following updates to this measure have been made after it came into effect.
|01 January 2023||
The Law amending Article 19 of the Law on Value Added Tax of the Republic of Lithuania No IX-751 entered into force in Lithuania on 1 January 2023. The new law foresees that the preferential 9% VAT rate will be applied indefinitely to the accommodation services and attendance at all types of art and cultural institutions. The preferential 9% VAT rate for catering services has been extended until 31 December 2023; for performance services provided by performers and sports events until 30 June 2023
According to the Lithuanian Association of Hotels and Restaurants (LAHR), about 2,600 companies in the catering sector, employing about 30,000 people, will be able to benefit from the VAT relief in Lithuania. No information is available for the cultural sector.
|Does not apply to workers||
Sector specific set of companies
||Does not apply to citizens|
Company / Companies
Public support service providers
No special funding required
Social partners' role in designing the measure and form of involvement:
|Trade unions||Employers' organisations|
|Form||Not applicable||Not applicable|
Social partners' role in the implementation, monitoring and assessment phase:
No information available.
The LAHR President welcomed the measure. According to her, restaurants will be able to use the additional funds to cover debts and raise salaries for staff. Representatives of trade unions and employers in the cultural sector have not expressed their views in that regard.
This case is sector-specific
|Economic area||Sector (NACE level 2)|
|I - Accommodation And Food Service Activities||I56 Food and beverage service activities|
|R - Arts, Entertainment And Recreation||R90 Creative, arts and entertainment activities|
|R91 Libraries, archives, museums and other cultural activities|
|R93 Sports activities and amusement and recreation activities|
This case is not occupation-specific.
Eurofound (2021), Preferential VAT rates for catering industries and the cultural sector, measure LT-2021-26/1956 (measures in Lithuania), EU PolicyWatch, Dublin, https://static.eurofound.europa.eu/covid19db/cases/LT-2021-26_1956.html
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Disclaimer: This information has not been subject to the full Eurofound evaluation, editorial and publication process.