Tax regulation mechanism (Exemption from the Environmental Pollution Tax)

Updated: 13.02.2017

Author: Jurga Tallat-Kelpšaitė

Environmental pollution tax for stationary sources of pollution shall be paid by all operators of combustion installations with a rated thermal input equal to or greater than 20 MW but not exceeding 50 MW and operators of combustion plants which contain a solid fuel-fired boiler with a furnace thermal efficiency equal to or greater than 0.5 MW but not exceeding 20 MW (Appendix 1 Items 2.1 and 2.2 Order No. D1-259/2014 in conjunction with Art. 4 Par. 1 Law on Environmental Pollution Taxes). Operators using biogas, solid and liquid biomass shall be exempt from environmental pollution tax for all stationary source emissions resulting from the use of biogas, solid and liquid biomass (Art. 5 Par. 4 Law on Environmental Pollution Taxes). 

Eligible technologies

Under this support scheme, only biogas, solid and liquid biomass is eligible (Art. 5 Par. 4 Law on Environmental Pollution Taxes; Chapter I Art. 2 Law on Energy from Renewable Sources).

Biomass

Eligible

Biogas

Eligible.

Amount

The amount of subsidy is equal to the amount of tax a natural or legal person is exempt from. The tax rate for stationary sources depends on the type of pollutants and on where they are emitted – in the air, the water or the ground. The tax bands are set out in the Law on Environmental Pollution Taxes (Art. 11 Par. 1 in conjunction with the Appendix 1 Law on Environmental Pollution Taxes). 

Addressees

Entitled party: Natural and legal persons who have submitted documents confirming the use of biogas, solid or liquid biomass as a fuel in stationary sources of pollution (Art. 5 Par. 4 Law on Environmental Pollution Taxes). 

Procedure

Process flow

Natural and legal persons using biogas, solid and liquid biomass in statutory pollution sources have to provide evidence confirming the use of it (Art. 5 Par. 4 Law on Environmental Pollution Taxes). Individuals using biogas, solid and liquid biomass for energy production may verify its use on the basis of the following documents:

  • documents verifying the purchase of biogas, solid and liquid biomass (e.g. invoices, purchase agreements, etc.);
  • write-off documentation;
  • waste management accounting report;
  • report on energy production from bio-degradable waste;
  • report on biodegradable waste from manufacturing process.

Evidence supporting the acquisition and use of biogas, solid and liquid biomass must be provided to the environmental protection officers or tax officials if they request them during the company's tax audit (Chapter III Item 16 Second Document of the Order No. D1-370/1K-230).

Competent authority

Regional environmental protection departments under the Ministry of the Environment of the Republic of Lithuania and EPA (Chapter II Art. 6 Law on State Environmental Control).

Distribution of costs

State

The costs of tax relief are borne by the state.