Lithuania: bank solidarity contribution revenue can be invested immediately – advisor

VILNIUS – As Lithuanian President Gitanas Nauseda on Monday signed the temporary bank solidarity contribution bill into law, his advisor Irena Segaloviciene says revenue collected from this law can be invested in military and civil infrastructure immediately and can thus stimulate Lithuania's slowing economy.

"We see that solidarity contribution funds can be used immediately, and by creating a maximum "green" corridor administratively for such projects, we could actually kill two birds with one stone: to stimulate investment and to also bolster our military infrastructure," Segaloviciene told the Ziniu Radijas news radio on Tuesday. 

In her words, military infrastructure projects funded with bank contribution money will help to keep Lithuania's economy viable.

"Military mobility projects, including those to be funded with solidarity contribution money, will have a very important role to play in stimulating investment in order to help our economy to be as viable as possible and to stay on that positive trajectory," Segaloviciene said.

For its part, the Association of Lithuanian Banks is, among other things, concerned about practical issues related to the new tax as it remains unclear how exactly it will be calculated and paid, although the first advance payment is due by August 31, Moreover, banks' IT systems may have to be changed, the banking body also said.

Segaloviciene says that if any questions arise, they will have to be addressed by the Finance Ministry or the central Bank of Lithuania.

Under the new law, the levy will amount to 60 percent of banks' net interest income that exceeds the average of four regular financial years by more than 50 percent.

The levy is expected to raise more than 400 million euros in revenue for the state. The money will be then used for defense and military and civilian transport infrastructure.