The consolidated revenue in budgets, the EU and other international funds included, will amount to EUR 9.997 billion, with a 5.9 % increase on the planned revenue for 2016, while the appropriations will make up EUR 10.580 billion, with an increase of EUR 504 million as compared to 2016.
The estimate is that the state budget and municipal budgets will receive tax revenues of around EUR 7.282 billion, i.e. an 8.8 % rise as compared to the planned revenues for 2016.
The gross domestic product (GDP) is expected to grow by 2.7 % in 2017, i.e. 0.5 % down as compared to the forecast in the spring. The Minister said the reason behind was increased geopolitical uncertainty and the decision of the United Kingdom to withdraw from the EU.
“Lithuania is an open trade economy, with its exports and imports making up over 70 % of GDP. Therefore, lower expectations of our trade partners may adversely affect both the trends of Lithuanian exports and the growth potential of the Lithuanian economy. Mutual economic relations between the European Union and Russia are the main external risk that counts when planning and endorsing the budget for the next year. We see a number of external threats that Lithuania must be adequately prepared for,” said Ms Budbergytė.
The Minister of Finance stated that the 2017 budget was strategically oriented towards the reduction of social exclusion, strengthening of the national security, and financing of necessary structural reforms.
With a view to reducing social exclusion in 2017, the proposal is put forward to decrease personal income tax by increasing the amount of tax-exempt income from EUR 200 to EUR 310 and the additional amount of tax-exempt income, depending on the number of children, from EUR 120 to EUR 200.
Nearly EUR 126 million are earmarked for salary increase in the draft budget for the coming year.
The Minister highlighted an increasing focus on education: “Although the number of children starting school in September this year has decreased, the special targeted grant to municipal budgets for financing the pupil’s basket has not declined by EUR 4 million. It will even increase by EUR 23 million next year.”
In 2017, the Republic of Lithuania plans to contribute almost EUR 65.5 million to the European Stability Mechanism and to allocate nearly EUR 723.5 million to the Ministry of National Defence.
After the submission, the draft state budget will be considered in compliance with the procedure set out in the Statute of the Seimas. The Committee on Budget and Finance is the lead committee for the consideration of the draft, with all the remaining Seimas Committees functioning as additional committees. The preliminary date for the first reading of the draft at the Seimas plenary sitting is 25 November 2016.
The 2017 state budget should be adopted by the new Seimas elected for the 2016–2020 term.
