2024-04-22 10:38:40
Amendments to several laws were urgently submitted to the Seimas for consideration, stipulating that large arms and ammunition manufacturers would be allowed to start building factories in non-urbanized areas without a municipal permit, which would have to be obtained before the end of construction.
According to the government, this would help to develop the industry that meets defense needs as quickly as possible.
These amendments are related to the German giant Rheinmetall’s plans to build an artillery ammunition factory in Lithuania.
The contract with this company is expected to be signed in a couple of weeks, and production would begin at the end of 2025.
There are more people who want to develop the defense industry in Lithuania – negotiations are underway with the manufacturers of the USA, France, and some other countries.
In addition, the business of our country is also ready to invest – according to the Confederation of Lithuanian Industrialists, there are already almost three dozen companies that would like to produce dual-purpose products or even completely change their profile.
Possible military conflicts need to be prepared on a larger scale. It was not for nothing that the new Minister of National Defense, L. Kasčiūnas, talked about the military commandant offices, which should start operating soon, as well as the planned training center for drone operators.
Installation of anti-mobility points should begin in the second half of this year.
There are 27 such points, they will be established at strategically important places and will have the main means of stopping heavy military equipment – the so-called “dragon’s teeth”, reinforced concrete barriers, etc. Consideration is also being given to where to establish another training ground for mobility exercises.
The State Defense Council has decided that Lithuania should purchase German Leopard tanks, but for now only consultations are taking place with the manufacturers.
For some experts, it seems that it is better to invest in anti-missile and anti-aircraft defense or in drones.
Basically, everything is needed: drones, tanks, artillery guns, Patriot or similar systems.
There is only one problem – here and now Lithuania cannot purchase enough weapons. And not only because manufacturers have enough orders.
There are simply no funds for this, and after all, we should be talking about several billion euros.
Four defense funding models have already been introduced to allow for 3 percent of the gross domestic product (GDP) instead of the current 2.5 percent for national defense.
One of the models is to implement the almost buried tax reform and 1 percent. to increase the profit tax, the second is to raise the profit tax by the same amount, and instead of 21 percent value added tax (VAT) rate is set at 22 percent.
The third is to increase the profit tax from 15 to 17 percent, give up its benefits for small companies and delete the VAT benefit for heating. Fourth – 2 percent. raise the profit tax and take part of the personal income tax from the municipalities.
The Ministry of Finance projects that in all cases it will be possible to collect the required 400 million. an amount of euros, which would be additionally allocated to national defense. Which model will be presented to the Seimas is still under discussion. Both the Government and the Tripartite Council should decide on this.
The representatives of business organizations were surprisingly unanimous in favor of the second option.
But some politicians are proposing another way out – a sharper increase in corporate tax, especially as the so-called defense solidarity tax imposed on big banks is about to expire.
But in this case, our country risks becoming very unattractive for investments – both Lithuanian and foreign capital.
In turn, a business that controls larger companies could quite easily move its management outside of Lithuania – where profits are taxed less. Then the state runs the risk of staying with the split geld.
On the other hand, when hearing such speeches, businessmen do not hide their displeasure as to why the additional defense needs of the country should be financed only by them, and not by the entire society.
“First of all, every entrepreneur is also a part of society, and secondly, even with the current profit tax, our investment climate is going through, to put it mildly, not the best of times.
After all, if the business joins, maybe the state also wants to reduce its expenses by some 5-10 percent? It’s not necessary to say that it will immediately affect teachers and doctors – there is definitely room to tighten our belts in our bureaucratic apparatus”, thought V. Janulevičius, head of the Confederation of Lithuanian Industrialists.
The agreement on defense financing is currently one of the most important. Not surprisingly, there is and will be much controversy over this.
Only one thing is certain – at least in the near future, more and more money will have to be allocated for this, maybe even 4 percent. GDP as called for in the now announced promotion.
In other words, it will be necessary to reorient to a different economy.
2024-04-22 10:38:40