The luxury car tax is targeted at high-performance vehicles with a power output exceeding 150 kW.
Lithuania published a draft law proposing a luxury tax on high-powered cars on 29 October 2025.
The tax will apply to M1-class vehicles with engines exceeding 150 kW, calculated as a percentage of the vehicle’s value: 1% for engines between 151 kW and 300 kW, and 2% for engines exceeding 300 kW.
Cars with engines up to 150 kW are generally exempt unless their price exceeds the previous year’s segment average by more than 20%, in which case a 1% tax would apply.
Families with two or more children would be exempt when buying larger SUVs or six-seat vehicles with engine power up to 250 kW, provided the price does not exceed 20% above the market average.
If adopted, the tax would take effect as of 1 January 2026.
