Authorities don’t want to pay a real estate tax?

The authorities seek for everyone to pay for real estate – from the first euro.

« Universal does not mean that only residents pay. Universal means that we are paying all the real estate, » said Mindaugas Statulevičius, head of the Lithuanian Real Estate Development Association (LNTPA).

Much of the real estate is managed not only by business or residents, but also by the state and municipalities.

« The Property Bank owns about 10 % of the total state’s real estate, » said Gintaras Makidas, head of the Property Bank.

G. Makime. G. Skaraitienė / Photo by BNS

According to him, the value of this real estate is about $ 220 million. euros. However, the majority of the state – more than half of the real estate – is controlled by municipalities.

According to the National Audit Office, municipalities manage more than 45 thousand. various buildings and premises with a total area of ​​over 12 million. sq.m. meters. Their value is more than $ 2 billion. euros.

Economists warn that these assets are often not used effectively.

« Because the tax does not have to pay, those assets are hanging in balances and not efficiently exploited. This pushes out private investments – after all, this real estate could be used for housing development and would increase supply to reduce housing prices, ”explained Sigismund Mauric, chief economist at Luminor Bank.

Ž. Mauric. Photo by A. Ufarto / ELTA

« There are no limits for perfection – some municipal real estate is better, others are less effective, » said Audrius Klišonis, president of the Municipal Association.

According to the National Audit Office, some of the municipalities use premises or buildings are not used for their intended purpose, some do not fully know how much and what they have, or what they intend to do with unused real estate.

« Every real estate object used is not only tasteless in balance sheets, but also requires additional costs to maintain it, » said Klišonis.

Ministries’ offices also occupy large areas with an average of 20 sq. M. meters per employee.

« It is really possible to connect quite a lot, » said the Turto bankas.

« There must be stimuli to state institutions to avoid abusing the area, » said Rimantas Šadžius, Minister of Finance.

The builders therefore explain that the real estate tax should also be paid by the state.

« Business is already paying, residents will pay, but we have left a large proportion of the real estate on the border – the property of the state and municipalities, as well as their assets of their companies, » said Statulevičius.

Economists believe that such a fee would force the public sector to use available real estate more efficiently.

« The initiative would be welcomed as it would encourage even more effective use of the real estate available, » said Ž. Mauric.

« It would certainly become all the audits, evaluate how much wealth they have, they would start to cost them, to have a relatively financial pain and to think about what to do with it. Either to overcome it or to sell it, to rent, to give up, » said Statulevičius.

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Prime Minister Gintautas Paluckas points out that unnecessary real estate is sold at auctions, so the state is already seeking to optimize property management.

« The state can calculate a real estate fee, but would pay to itself – from one pocket to another, » the prime minister said.

Minister of Finance R. Šadžius does not see the real estate of the real estate to tax state institutions.

« Well, it would be just absurd, » he believes.

According to the ministry, the real estate of the state is already managed by strict rules – it is leased from the Turto bankas and the authorities pay for this lease from their budgets.

« State authorities rent real estate from Turto bankas and pay rent from their budget, » explained R. Šadžius.

The head of the Property Bank G. Makšta says that in recent years the authorities have already abandoned some unnecessary real estate.

« Over the past year, the authorities have abandoned 46.6 thousand sq. M. meters of unnecessary real estate, which has been sold and the funds received have been invested in the renovation of the necessary buildings, » Mr Makida said.

According to the Turto bankas, officials could still be used to their office – old buildings up to 17 sq. M. m, up to 14 square meters in new person.