Legislation, Lithuania, Markets and Companies, Taxation

The newspaper had previously written that, on 28 April the Ethics Commission of Journalists and Publishers (LZLEK) issued a judgment against the daily Respublika which took effect on 29 April. A financial penalty for purported ethics' violations was imposed – 12% reduced VAT rate was revoked and instead of 9% VAT rate 21% VAT rate was applied. The newspaper did not even manage to appeal to the court.

Some members of Parliament and lawyers could not explain how such curbs emerged in legislation. One of those baffled by the revocation of reduced VAT rate was lawyer Liudvika Meskauskaite. She questioned how a popular television channel TV3 and two major daily newspapers Respublika and Lietuvos Rytas came under scrutiny for ostensible ethics' violations.

Furthermore, on Monday, 12 May, LZLEK had to consider whether another daily Vakaro Zinios has also breached professional ethics. LZLEK Chairman Linas Slusnys refused to hold an open hearing declaring that regulations require to hold one behind closed doors. He added that the issue was being transferred to the digital space.

A pretext to consider the daily Vakaro Zinios as unethical was three publications about Bank Snoras bankruptcy administrator Neil Cooper, which questioned whether LTL 100 thousand (EUR 29 thousand) monthly salary and consultant fees were not too high for Lithuania's standards.

As reported, on Monday, Minister of Justice Juozas Bernatonis initiated amendments to the Law on Value Added Tax which would prohibit LZLEK (formed by private entities) to censor the printed press.

Amendments should be registered in the Parliament this week but would only be adopted in the spring session.

In the previous parliamentary term, in 2012, the Seimas led by conservatives amended the legislation and established a provision that newspapers, journals and other periodicals may be applied different VAT tariffs – the standard 21% or the reduced one of 9%.

What tariff is applied to what newspaper or journal depends not on any democratically elected institution or court but, instead, on LZLEK. Reduced 9% VAT tariff applies only to those periodicals which keep to professional ethics. What periodicals meet the standards of professional ethics is also decided by LZLEK.