While the coalition calculates taxes and divides portfolios, the ranks of the opposition continue to thin. What's happening? What changes can the opposition expect under the new coalition? Why did Kristen Michal decide to continue with the old lineup?
While the coalition calculates taxes and divides portfolios, the ranks of the opposition continue to thin. What's happening? What changes can the opposition expect under the new coalition? Why did Kristen Michal decide to continue with the old lineup?
Member of the Riigikogu from the Center Party, Deputy Chairman of the Finance Committee Andrei Korobeinik answered questions from Rus.Postimees live.
Excerpts from the conversation :
– Will there be many replacements in the government of Kristen Michal? Which ministries will be divided into two portfolios?
– The number of portfolios, if increased, will be based on objective realities, and not on the interests of coalition parties. For example, it is obvious that the Ministry of Climate Change has not worked, and areas of responsibility may be replayed here. Perhaps we will see the Environment Minister again. I don't believe Kristen Michal will leave the climate super-ministry as it is.
We will probably see changes in the Ministry of Education. In this area, as is known, very serious problems have emerged with a shortage of teachers. I think that it would be logical for Christina Callas to give this briefcase to anyone. Otherwise, in the fall she will have to take responsibility for what is happening in schools.
I don’t believe that Mart Vyrklaev will continue as Minister of Finance. This would be a disaster for Estonia. If Michal doesn't replace him, I will be very surprised.
It's no secret that Kristen Mikhail and Hanno Pevkur ( Minister of Defense – editor's note ) do not get along very well with each other. However, apparently, there is some kind of pragmatic agreement there.
In general, ideologically this coalition will not differ much from the previous one. We will not see a sharp change in course.
– How do you assess the prospects for the new old coalition?
– If we talk about the economy as the most important problem in Estonia, then we will not see any special changes in the course. But we will see an increase in taxes. At the same time, no tax on excess profits of banks is expected. There will be no radical cuts to the public sector and no cancellation of the Reform Party’s tax reform, which will cost the state budget half a billion euros. This means that the economy will not begin to grow faster. Most likely, next year we will be in last place in Europe in terms of economic growth, as we were this year and last year.
For example, this year Estonia will be the only country not only in the EU, but in all of Europe, whose economy will decline. Even the economies of Ukraine and Russia will grow, and Estonia will end the year with negative growth.
– Is it possible to bring the economy out of the crisis?
– It is possible to bring the economy out of the crisis, but the new coalition does not plan to take a single step in this direction. First, the Estonian economy would benefit from reducing inequality in society. If the poorer sections of the population had more money left, it would immediately return to the state budget. Now we are seeing the opposite when income tax is introduced on pensions or the tax hump is planned to be abolished. In this case, the MP will receive an additional 450 euros per year, and for pensioners this will mean a loss of 150 euros. Such steps certainly do not contribute to economic growth.
Let me remind you that income tax was raised in order to pay for this reform.
– Are the already announced methods of filling the budget effective? It is reported that the coalition plans to increase sales tax, income tax and introduce a business tax…
– I think that the coalition’s plans are to introduce a temporary tax on war. In general, this is the right step, and it was necessary to start with it…
– Will the opposition vote for the defense tax?
– Depends on what we're talking about. Of course, the opposition would support such a step if it were accompanied by a tax on excess profits of banks (this is approximately half a billion euros) and the abolition of benefits for the rich in the form of a tax “hump” (this is another half a billion euros).
Next year, according to Michal himself, the Estonian economy will already be two billion euros short. If a bank tax is not introduced and benefits for the rich are not abolished, the hole in the budget will continue to grow. It will take us a long time to get out of the crisis. I don’t even rule out that it will be about 10 years.
– Can you clarify for us the fate of the car tax?
– The President rejected the car tax for a rather cosmetic reason, seeing unequal treatment in the law against the backdrop of benefits for people with special needs. As a result, the coalition plans to completely abolish all benefits for people in this category so that everyone is equal before the law.
The Center Party will not support the bill in this form. Let's wait to see what the Chancellor of Justice says.
– Will the amended law come into force by the deadline of January 1, 2025?
– The coalition may try to carry it out in time. Kaya Kallas has already said that the requirement that tax changes must be adopted six months before entering into force is just a recommendation, not a rule. That is, if it is really necessary, then everything can be done faster. I hope that Kaya Kallas, as a former lawyer, will not treat all laws this way. I don’t know Kristen Michal’s position on this issue. It is possible that the hastily adopted law will again be protested by the president, or the Chancellor of Justice will intervene. It is also possible that the bill will come into force on July 1 next year.
– Why did Kristen Michal decide to continue with the old composition, without inviting any of the opposition parties into the government?
– I think that the Reform Party was choosing between leaving the coalition with three or two partners. Now it is convenient for the reformists to continue to rule as three of them, since Eesti 200 solves absolutely nothing and acts at the behest of the Reform Party. And the Social Democrats, although they say that a progressive income tax and a tax on excess profits of banks could be introduced, are actually doing nothing in this direction. Thus, these are convenient partners, which in Estonia are usually called poodles.
There are no parties in the opposition that would nod their heads in agreement with any decision of the Reform Party.
More details in replay!
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Postimees studio: the coalition counts taxes, the opposition counts defectors? Photo: Oliver Kaur
- How does the opposition assess the prospects of the new coalition?
- Is it possible to bring the country's economy out of crisis?
- Are the voiced methods of filling the budget effective?
- What will change for the opposition under the new coalition?
- What is happening in the opposition ranks now?
- Will the collapse of EKRE and the drain of personnel from the Center Party stop?
- Tallinn City Assembly member Jaanus Riibe left the ranks of the centrists. Should we expect new defectors?
- The Tallinn coalition increased its lead to three votes. Will anything change before the next elections?
- Future Prime Minister Kristen Mikhail is considered a strong reformist politician from Tallinn's point of view. How serious will the fight for the capital be in the municipal elections?
