The effect of taxes and subsidies on economic viability of farms

The article deals with the effect of support and taxes on economic viability of farms. Assessment of economic viability of farms has suggested that in Lithuania, support is the main externa! factor of continued viability ofsmall- and mid-sizedfarms, while the unequal distribution of the tax burden reduces economic viability of farms and they become non-viable. The problem put forward in the research is what taxation system would create conditionsfor the farmers 'farms to remain viable, irrespective of the support. Alternatives on improvement of farmer taxation system are proposed The paper presents the practice of farmer taxation in other countries and analysis of scientific literature on the subject, on the basis of which the model for improvement of farmer's profit taxation, as well as social and healthcare insurance contribution is put forward. This model would ensure more equal distribution of tax burden between the farms of different sizes, which would allow the j'arms to remain viable irrespective of the scopes of the received supportKauno kolegijaVytauto Didžiojo universitetasŽemės ūkio akademij