Lithuania’s Prime Minister, Gintautas Paluckas, resigned on July 31, 2025, following growing scrutiny of transactions involving companies linked to his family and mounting pressure from his coalition partners.
Paluckas led the Social Democrats into government late last year under a three-party coalition formed after the October 2024 elections.
The resignation came after media outlets revealed that one of his businesses, Garnis—which he co-owns—received a subsidised loan from the national development bank during his time in office.
Further attention focused on contracts awarded to another firm tied to his sister-in-law using EU funds to purchase materials from Garnis.
Authorities have now opened investigations into these transactions.
For Lithuania’s junior coalition partner, For Lithuania, the revelations prompted an ultimatum: Paluckas must step down by August 18 or the party would leave the government.
Without that party’s seats, the ruling alliance would retain just a narrow majority of 71 in the 141-seat Seimas, risking its collapse.
Despite denying any wrongdoing and blaming political opponents for a coordinated smear campaign, Paluckas decided that his departure would prevent further damage to his family and to the coalition’s stability.
The entire cabinet is expected to resign as talks begin to form a new government .
Separately, a separate controversy from 2012 — in which Paluckas was found to have abused his office in a public procurement case and fined €16,500, a penalty he never fully paid — was cited as worsening public perception of his leadership .
His departure comes as Lithuania prepares for joint military exercises between Russia and Belarus, and seeks to maintain government cohesion amid security challenges.
Foreign policy is expected to remain unchanged under President Gitanas Nausėda, who will oversee the transition .