Budget, Financial Services, Lithuania, Taxation

"I think we can already talk about trends and that we are likely to fulfil tax collection plan this year. It is apparent that excise duty projections will be exceeded. On the other hand, value added tax (VAT) collection plan will not be accomplished," the minister said.

Talking about VAT collection plan, the minister said that it was ambitions but the reasons behind failure to fulfil it lie in the domestic and not international environment.

"It has little to do with the surrounding crises, () I believe we fail to collect taxes because we have not managed to reduce the underground economy effectively and rapidly enough," the minister told the Ziniu Radijas radio on Thursday.

Sadzius noted that tight co-operation between the State Social Insurance Fund (SoDra) and the State Tax Inspectorate is needed to combat shadow economy because substantial amount of income tax is evaded through fraudulent payment of salaries.

As reported, based on preliminary assessment, tax collection surpassed projections by 0.8% in the first nine months of 2014. In January-September 2014 LTL 14 billion (EUR 4 billion) or 3.7% more taxes were collected compared with the same period of 2013. So far in 2014 the aggregate budget revenue stands at LTL 16.94 billion (EUR 4.91 billion).