Lithuania operates a value-added tax (VAT) system known locally as Pridėtinės vertės mokestis (PVM). Lithuania is an EU member state and its VAT framework is aligned with the principles of the EU VAT Directive.
Lithuanian VAT is governed primarily by the Law on Value-Added Tax (Pridėtinės vertės mokesčio įstatymas) and related regulations. VAT is administered by the State Tax Inspectorate (Valstybinė mokesčių inspekcija, VMI) under the Ministry of Finance. The VMI is responsible for issuing guidance, processing VAT registrations and returns, overseeing electronic reporting systems, and enforcing VAT compliance.
Businesses carrying out taxable activities in Lithuania — whether resident or nonresident — must comply with Lithuanian VAT obligations. This includes VAT registration where required, applying the correct VAT rates, issuing VAT-compliant invoices, maintaining appropriate accounting records, and filing periodic VAT returns in accordance with Lithuanian and EU VAT rules.
