Lithuanian lawmakers have tightened the existing rules and capped cash settlements between residents and businesses at 5,000 euros, with changes set to come into force in November.
Any payments above the cap will only be allowed in a non-cash form.
However, cash payments will still be allowed if one party does not have a bank account, needs to make a swift payment or in cases of internet problems. The parties involved in such transactions will have to inform the National Tax Inspectorate.
Prime Minister Ingrida Simonyte doubts whether small businesses will be affected by the Seimas’ decision, as “5,000 is a considerable amount”.
The Seimas Committee on Budget and Finance proposed setting the cap at 3,000 euros, but the parliament rejected the proposal.
Figures from the Bank of Lithuania show that 97% of all payments in the country are under 5,000 euros.
According to the Financial Crime Investigation Service, 26.5% of payments in Lithuania’s real estate market are still done in cash. (LRT/Business World Magazine)
