Although the Reform Party, Social Democrats and Estonia 200 have not yet agreed on all the details, it is clear that there will be a new tax. It will be called either a defense tax, an integrated defense tax, or a security tax. /nginx/o/2024/07/16/16226318t1h2e77.jpg)
Press conference summing up the results of the first day of coalition negotiations between the Reform Party, Eesti 200 and the Social Democrats in the White Hall of the Riigikogu. Pictured (from left to right) are Lauri Läänemets, Kristen Michal and Margus Tsahkna. Photo: Madis Veltman
Although the Reform Party, Social Democrats and Estonia 200 have not yet agreed on all the details, it is clear that there will be a new tax . It will be called either a defense tax, an integrated defense tax, or a security tax.
This is not just an increase in existing taxes, but an entirely new tax. The main components in its calculation will be turnover and income. As one of the reformers says, it is impossible to invent a new tax base: it will be income and consumption that will be taxed. In essence, of course, this means that we are talking about increasing VAT and income taxes.
The leader of the Social Democrats, Interior Minister Lauri Läänemets, said yesterday that everyone will see the national defense tax on their purchase receipts. This is also a hint that a tax similar to VAT will be introduced. If the current VAT is 22 percent, then increasing it – say, to 24 percent – will simply mean an increase in the VAT. But a new line on the sales receipt still means a new tax.
