For Lithuania – serious warnings: it can be disastrous

The International Monetary Fund team watched the Lithuanian people live for two weeks. After analyzing the country’s economy, the mission manager did not spare criticism for the second -pillar reform of the pension.

« Pension reform is a tricky affair. It will have a significant impact not only on pensions but also in the country’s finances, so careful consideration of all possible consequences before changes, » said Kazuk Shiron, head of the mission of the International Monetary Fund in Lithuania.

LNK stop shot

The economist says the warning is very serious.

« During the long period, pensions will be essentially lower due to the fact that there will be no part of the pension funds, » said economist Marius Dubnikov.

Lithuanian experts have long been signaling that pension reform may be disastrous, but no one listens.

« There have never been any 200 different branch organizations and associations in the history of Lithuania and have written that stopping tax reform, including pension reform. This is not taken into account, » Dubnikov said.

LNK stop shot

After criticism, a spokeswoman for the International Monetary Fund praised the real estate tax. Offers to make it universal.

« Lithuania is not collecting a lot of real estate tax. We see that there is a lot of space to expand their income from this tax. It could be an important source of revenue in the country, » Shiro emphasized.

According to a foreign expert, it is very good to have the money raised from the tax to municipalities.

Full LNK Report – In Video:

« It is basically a good idea, because if people pay taxes for their housing, the local government will be able to provide everyone with better services, » said the head of the mission of the International Monetary Fund in Lithuania.

However, she emphasizes that the most important thing about how the tax collection will be implemented is where the money will go, because it is possible to go the wrong path. The head of the Bank of Lithuania is worried about this.

There has never been any 200 different branch organizations and associations in the history of Lithuania and have written to stop tax reform.

« What is missing is a clear consensus as to why this fee is changing, what problem it is solving, » said Gediminas Šimkus, the head of the Bank of Lithuania.

What does it think that the ruling coalition is proposing that the first housing is to be charged, the representative of the International Monetary Fund is not clearly responsible.

The main challenges that Lithuania can face, according to foreign experts, is the increasing defense expenses, the deteriorating demographic situation – a declining labor force.

« One Lithuanian will have to do 2-3 times more added value after 20 years and thus solve a demographic problem. Otherwise, we will actually have big problems because we do not have young people who will occupy jobs, » the economist explained.

Experts of the International Monetary Fund praise the general economic resistance of Lithuania in the background of geopolitical tensions.