Lithuania to comply with EU's demands on diesel excise rates

Petras Austrevicius, the Lithuanian government's chief representative in accession talks with the European Union, said that Vilnius had agreed to comply with the EU's demands on diesel excise rates. Previously, Lithuania had asked for permission to bring diesel excise taxes up to EU levels gradually rather than by some time in 2004 as requested by the EU.
Austrevicius said, though, that Vilnius was no longer seeking permission to implement this transition-period plan. Instead, he said, diesel excises will be raised from the current level of 560 litai ($ 140) per tons to 1,003 litai per ton in 2004. Excise rates will be raised gradually, he said, with the first increase (to 720 litai per tons) to come earlier in 2002.

The EU asked Vilnius to raise excise rates because diesel prices are lower in Lithuania than in any other country seeking membership in the union. Austrevicius noted that the increase would impose hardships on some consumers. As such, he said, the government has decided to grantfinancial compensation to the groups most likely to be hit by the price hike -- specifically, fishermen and farmers.