Effective Date: 1 May 2025
Type: Legislation
Lithuania plans to raise the VAT registration threshold from €45,000 to €55,000 starting 1 May 2025, making it the fourth highest in the EU. The country has also adopted the EU SME VAT registration scheme, allowing small businesses to sell across the EU without VAT if their turnover is below €100,000 annually. The increase aims to ease compliance for small businesses and provide a tax break for B2C services, partly in response to inflation exceeding 20% after Russia’s invasion of Ukraine. While the EU VAT Directive sets registration thresholds, member states can apply for temporary exemptions with economic justifications. VAT in Lithuania is administered by the State Tax Inspectorate (STI), with a standard rate of 21% and reduced rates of 9% and 5% for certain goods and services.
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