REPUBLIC OF LITHUANIA PROVISIONAL LAW ON THE CURRENCY FUNDS AND CONVERTIBLE CURRENCY DEDUCTIONS Article 1.The System of Currency Funds of the Republic of Lithuania The system of currency funds of the Republic of Lithuania shall consist of the State currency fund of Lithuania and the currency funds of higher level local governments. Article
- The Objectives of the Currency Funds
- Resources from the State currency fund of Lithuania shall be allocated for: 1) financing the economic, social, ecological, scientific, educational and cultural needs of the State; 2) accumulating and increasing the currency savings of the Bank of Lithuania; 3) making donations to international organizations; 4) clearing the foreign debt of the Republic of Lithuania; 5) settling internal accounts; and 6) financing the currency expenditures of state authorities, government bodies, and state agencies abroad.
- Resources accumulated in local government currency funds shall be used to finance the economic, social, ecological, educa- tional and cultural needs of the respective town or district. Standards for financing business trips and other government ex- penditures shall be approved by the Government of the Republic of Lithuania.
- The State currency fund of Lithuania shall establish a currency reserve for the financing of unplanned currency expendi- tures.
- The rate of the currency reserve, expressed by the per- centage of income of the State currency fund of Lithuania, as well as by the revenues and expenditures of the fund, shall be approved by the Supreme Council of the Republic of Lithuania. Article
- Income of the Currency Fund
- The currency fund income shall be composed of the profit (income) tax of legal and natural persons, the income from the sale of currency to the State in the compulsory procedure, ex- cise duties, and other convertible currency dues.
- In 1991 and in the first quarter of 1992, state en- terprises and state stock corporations, in accordance with the procedure established by the Government of the Republic of Lithuania, must deduct 20 percent of their currency income for the State (currency reserve). Enterprises which purchase goods intended for sale must deduct 20 percent of the currency income profit acquired from the sale of the said goods. This procedure shall also be valid for currency income attained from the sale of goods manufactured in state enterprises and stock corporations to other enterprises. Deductions shall not be applied to the sum of currency receipts (earnings) which are apportioned to foreign legal and natural persons. A different procedure for the sale of currency to the currency fund, provided for in the bylaws ap- proved by the founders, may be applied to state enterprises which have a specific purpose. (Amended 20 February 1992)
- Enterprises of the Republic of Lithuania, whose income consists of both local and convertible currency, shall pay their profit (income) taxes in both currencies. The amount that the enterprise shall pay in roubles (litas) and in convertible cur- rency shall be proportional to the amount of roubles (litas) and convertible currency in the enterprise's income. Upon estab- lishing these proportions, the currency income and expenditures of an enterprise shall be recalculated in roubles (litas), ac- cording to the official exchange rate; the profit of an en- terprise shall be calculated in the same manner. The Government of the Republic of Lithuania may, upon the request of commercial-economic enterprises, more than half of whose income is comprised of profits from goods which are im- ported or exported for convertible currency, determine profit taxes in roubles (litas) and convertible currency in proportion to the income of the enterprise (income exceeding material expen- ditures and other comparable expenditures) in roubles (litas) and convertible currency. The amount of taxation shall be established by the Laws of the Republic of Lithuania on Income Taxes of Natural Persons, on Profit Taxes of Legal Persons, and on Foreign Investments in the Republic of Lithuania. Natural persons who, according to labour contracts, are payed in convertible currency, or who receive bonuses in convertible currency, shall pay a 28 percent income tax in the same currency in which the income is received.
- Excise duties (indirect tax) shall be paid for goods sold (services rendered) in the Republic of Lithuania for con- vertible currency according to the procedures established by the Government of the Republic of Lithuania. Income taxes shall be calculated and paid according to the procedures established by the Government of the Republic of Lithuania. Article 4.Distribution of Currency Income Among the State and Local Currency Funds of Lithuania
- Receipts of currency funds from enterprises which are owned by legal and natural persons ( with the exception of en- terprises which are owned by local governments) shall be dis- tributed in the following manner: 85 percent shall be allocated to the State currency fund of Lithuania; and 15 percent shall be allocated to the local government cur- rency fund with which the enterprise is registered.
- Receipts of currency funds from enterprises which are owned by local governments shall be distributed in the following manner: 15 percent shall be allocated to the State currency fund of Lithuania; and 85 percent shall be allocated to the local government cur- rency fund.
- Receipts of currency funds from sources specified in Paragraph 4, Article 3 of this Law, shall be distributed in the following manner: 70 percent shall be allocated to the State currency fund of Lithuania; 30 percent shall be allocated to the local government cur- rency fund on whose territory the products have been sold (services rendered).
- Receipts exacted upon the violation of this Law shall be distributed in accordance with the proportions set forth in Paragraphs 1-3 of this Article. Article 5.Payment for Currency Sold to Currency Funds or Received from Currency Funds
- State enterprises and stock corporations shall be paid for currency sold in 1991 to State and local currency funds of Lithuania from the appropriate budgets in roubles (litas), ac- cording to the established settlement rate.
- Enterprises, institutions, and organizations which are allocated currency from currency funds shall pay for the currency in roubles (litas), according to the established commercial settlement rate.
- The procedure for settling accounts in convertible cur- rency shall be established by the Government of the Republic of Lithuania in conjunction with the Bank of Lithuania. Article 6.Control of Currency Fund Income (Taxes, Compul- sory Sale of Currency)
- Currency fund income shall be controlled by tax inspec- tions in accordance with the procedures established by the Government of the Republic of Lithuania.
- Upon the sheltering of currency fund incomes, sums of un- remitted deductions shall be recovered by financial institutions without suing for claims, and a fine of double the amount in cur- rency shall be imposed on an enterprise without refunding it in roubles (litas).
- The utilization and formation of currency funds shall be controlled by the State Control Department and by control divi- sions of local governments. Article 7.The Procedure for the Utilization of Currency Funds of the Republic of Lithuania
- The draft plan for the utilization and formation of the State currency fund of Lithuania shall be prepared by the Government of the Republic of Lithuania.
- The plan for the utilization and formation of the State currency fund of Lithuania, submitted by the Government of the Republic of Lithuania, shall be approved by the Supreme Council of the Republic of Lithuania.
- The plans for the utilization and formation of local government currency funds, submitted by local government boards, shall be approved by local government town (district) Councils. Article
- Supplementary Provisions
- The following shall be exempt from currency fund deduc- tions: societies for the blind, the deaf and other invalids, as well as their organizations and enterprises; the Red Cross Society; the Bishop Motiejus Valancius Sobriety Movement; the Fund of Culture, Charity and Health; the Children's Fund; other organizations and funds whose main goal is charity, as well as their enterprises and organizations; and medical institutions, if their currency income is not used to pay wages, premiums, or other payments. (Amended 28 November 1991)
- Enterprises which sell products or render services in ex- change for currency may transfer a certain portion of their cur- rency resources to other enterprises connected with the manufac- turing of said products or rendering of services in the amount specified in a mutual agreement. If the manufacturing of a good (product) sold for convertible currency requires the supply of raw materials or products which are distributed in a centralized manner, their manufacturer (enterprise registered in the Republic of Lithuania) shall be paid no less than 50 percent of the fixed (agreed) price in currency, according to the settlement rate.
- It shall be established that all enterprises, institu- tions, and organizations of the Republic which have foreign cur- rency must keep their currency in separate Lithuanian accounts or in foreign banks. Vytautas Landsbergis President Supreme Council Republic of Lithuania Vilnius 21 March 1991 No.I-1159