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This announcement is preparatory to the forthcoming tender for the exploration and extraction of Lithuanian amber resources.

It was proposed that the tax should be 20% that of the amber market value. However, amber market prices in Lithuania have not been reviewed since 1992. In comparison, the same tax ranges between 15-25% in the rest of the European Union. This is equal to an increase from 20.2 EUR/kg to 280 EUR/kg for the amber fraction of up to 40 millimeters, and up to 900 EUR/kg for amber fraction greater than 40 millimeters.

After the government meeting Prime Minister Algirdas Butkevičius told reporters that tax increase should not deter potential amber exploration and production bidders:

“The international demand and price of amber is considerably higher. It is not a cheap commodity.” – said the Lithuanian prime minister.

According to the Ministry of Environment, tax increase will generate an income of 41 million EUR:

* 70% of this tax revenue will go to the state budget.
* 20% for the environmental protection program to the municipality in which the amber will be extracted.
* 10% of this tax revenue will be paid to the state budget for the Environmental Protection Support Programme fund. It will be used to acquire control measures for amber resource extraction and intelligence, and officials’ wages, who will carry out monitoring and environmental control.

In 2014, several companies requested Lithuanian Geological Survey to allow them to explore and extract amber from Curonian Lagoon Amber Bay. It is the first time amber extraction has been allowed from the Lithuanian soil. The change is driven by the decline in Russian production of amber in the Kaliningrad region and increased demand for raw materials in the market.

The following arguments have been used to back up the increase of the amber extraction tax:

* Raw amber material prices have increased several times over the past two years.
* Amber resources are limited (according to the preliminary estimates, there are only 112 tons of amber in Juodkrantė).
* Amber extraction will be carried out in the United Nations Educational, Scientific and Cultural Organization (UNESCO) protected Curonian Spit area.

Law amendments should come into force from the beginning of 2016. They still must be approved by the Lithuanian Parliament.