Lithuanian minister questions Latvia's fuel tax cuts as too costly to replicate

VILNIUS - Lithuanian Finance Minister Taurimas Valys has questioned Latvia's decision to temporarily cut excise duties on diesel and petrol, saying the measure would be too costly for Lithuania to replicate.

From October, fuel prices in Latvia are expected to fall by 8 cents per litre following the tax cut. The three-month measure is projected to cost the Latvian state budget 14.4 million euros.

Valys noted that a similar move in Poland cost the state 115 million euros and was not extended. According to the minister, such a measure would be "significantly too expensive" for the Lithuanian budget.

As the Lithuanian government weighs measures to mitigate the impact of high fuel prices on households and businesses, Prime Minister Mindaugas Sinkevicius also reiterated that cutting diesel excise duties would be costly.

Authorities are instead considering a temporary 50 percent discount on train and intercity bus tickets. Valys suggested that state subsidies for public transport fares would be a fairer solution than reducing fuel taxes.

Following the outbreak of conflict in the Middle East in mid-April, Lithuania briefly reduced the excise duty on diesel by 6 cents for a period of two months.