Draft law on the partial repeal of the Value Added Tax Act Amendment Act (489 SE) – first reading
Session: 15th Riigikogu, 4th session, plenary session
Date: 2024-11-11 21:07
Participating Politicians:
Total Speeches: 81
Membership: 15
Agenda Duration: 1h 49m
AI Summaries: 81/81 Speeches (100.0%)
Analysis: Structured Analysis
Politicians Speaking Time
Politicians
Analysis
Summary
The agenda’s first reading discussed the bill on declaring Article 489 of the law concerning the partial invalidation of the property tax law, initiated by the Isamaa faction. The bill addressed the nullification or alleviation of the effects of the property tax, aiming to halt or reduce the impact of federal tax increases on homeowners, farmland, and other real estate. Speakers included representatives from both the governing coalition and the opposition, and opinions were exchanged in a fairly intense and critical tone regarding the governing coalition’s tax policy design, the autonomy of local governments, and the assessment of tax increases (the assessment process and equalization fund). Immediate concern was also expressed about the fact that similar promises have been made by governing coalitions in the past, and that this current change puts many people and businesses at risk of uncertainty and increased tax burden. Ultimately, the Riigikogu’s governing committee decided to reject the bill 489 on its first reading, with the vote tally being 35 in favor, 12 against, and no abstentions. This highlighted that the opposition and the governing coalition, as well as various interest groups, have fundamentally differing opinions both on the nature of the tax plan and on the speed of its implementation.
Decisions Made 1
Bill 489 is rejected in the first reading. The vote result: 35 in favor, 12 against, 0 abstentions. The bill is dropped from consideration.
Most Active Speaker
The most active speaker was Urmas Reinsalu (representative and initiator of the Isamaa faction) – his role was at the center of the parliamentary debate, with a focus on criticism of the coalition's tax policy. Political position: right (right-wing).
Aseesimees Arvo Aller
AI Summary
Deputy Speaker Arvo Aller informed that as the fourth item on the agenda, the Isamaa faction-initiated draft law to amend the Land Tax Act, No. 489, will have its first reading, and on behalf of the initiators, Riigikogu member Urmas Reinsalu will speak.
Urmas Reinsalu
Profiling Isamaa fraktsioonAI Summary
Urmas Reinsalu called on Parliament to cancel the land tax increase, accusing the law of creating uncertainty and of increasing the tax burden, and of its harmful impact on rural life, entrepreneurship, and homeowners’ financial security.
Aseesimees Arvo Aller
AI Summary
The presentation was thanked, and it was requested that Tõnis Lukas answer some questions.
Tõnis Lukas
Profiling Isamaa fraktsioonAI Summary
In the presentation, the tax exemption for homestead land that would be enacted on Isamaa's initiative is discussed, as well as the critics' claim that it keeps land out of circulation and could hinder the economy.
Urmas Reinsalu
Profiling Isamaa fraktsioonAI Summary
Urmas Reinsalu stated that increasing the car tax and the land tax burdens homeowners and does not boost the economy, and Isamaa demands the repeal of these taxes, because the coalition lacks a mandate and the plan lacks legitimacy.
Aseesimees Arvo Aller
AI Summary
The deputy chairman Arvo Aller invited Riina Solman to come on stage to perform.
Riina Solman
Profiling Fraktsiooni mittekuuluvad Riigikogu liikmedAI Summary
Riina Solman expressed full agreement with the speaker's words, noted that she hadn't heard everything because of the long corridors, and asked for a moment to clarify exactly what the government's verbal dexterity was in imposing the land tax.
Urmas Reinsalu
Profiling Isamaa fraktsioonAI Summary
Urmas Reinsalu stressed that the promise of the new land valuation law, adopted in the summer of 2021, to protect people's expectations of a stable 10% tax rate, soon collapsed, and the current plan to introduce a property tax would take into account both land and building values, making home ownership inaccessible for many.
Aseesimees Arvo Aller
AI Summary
This is simply a request to invite Priit Sibul to perform.
Priit Sibul
Profiling Isamaa fraktsioonAI Summary
Priit Sibul asks whether the claims that local authorities can make exemptions and establish maximum rates for land tax are true, and notes that in the calculations of the equalization fund the application of these maximum rates has been taken into account, which may harm the competitiveness of agricultural producers and forest owners.
Urmas Reinsalu
Profiling Isamaa fraktsioonAI Summary
Urmas Reinsalu said that the government plans to raise the land tax to fund local governments, which would place a heavy burden on homeowners and the elderly, and there is no mandate or analysis for this, seeing it as an expression of the manor lord's power.
Aseesimees Arvo Aller
AI Summary
Speak near the microphones, otherwise some words will be left out of the transcript later.
Urmas Reinsalu
Profiling Isamaa fraktsioonAI Summary
This speech asks which words were left out, and laughter rang through the hall.
Aseesimees Arvo Aller
AI Summary
He says that right now it is still unknown, and later it will become clear what will happen next.
Urmas Reinsalu
Profiling Isamaa fraktsioonAI Summary
The speaker briefly states that he has understood and agrees.
Aseesimees Arvo Aller
AI Summary
Vice-chairman Arvo Aller said "For the future" and asked Andres Metsoja.
Andres Metsoja
Profiling Isamaa fraktsioonAI Summary
In Metsoja's speech, he expresses concern about the speed and impact of an unassessed procedure, and asks whether the government will ease off or press the pedal to the floor, while noting that in 2026 there could be a 50% increase in the spending ceiling or a need for funding sources.
Urmas Reinsalu
Profiling Isamaa fraktsioonAI Summary
Urmas Reinsalu criticizes tax increases and price increases that primarily burden rural areas and reduce people's purchasing power, and calls on others to offer a firm, predictable future, ultimately asking what all this is for.
Aseesimees Arvo Aller
AI Summary
This is a short prayer to Jaak Aabile.
AI Summary
Jaak Aab admitted that the land tax problem has a long history: the last regular land valuation was in 2001, tax rates remained the same for ten years, local governments raised them to the maximum, and land became eight times more expensive, which is why the state has long been unable to meet its obligations.
Aseesimees Arvo Aller
AI Summary
The speech says that it's time for you to act.
Urmas Reinsalu
Profiling Isamaa fraktsioonAI Summary
Urmas Reinsalu secretly noted that Isamaa fears the logic of the land tax assessment and the failure to fulfill promises, and the larger land tax planned for 2025–2026 together with the removal of the dwelling exemption would affect up to 520,000 homeowners, and people will finally know the truth in the form of an invoice.
Aseesimees Arvo Aller
AI Summary
The vice-chairman Arvo Aller asks Riina Solman to take the floor.
Riina Solman
Profiling Fraktsiooni mittekuuluvad Riigikogu liikmedAI Summary
Riina Solman said that owning a home is a matter of dignity and that tax increases are making it increasingly difficult; she recalled the halt to Tallinn's land tax increase and their efforts to remedy the government's decisions, and asked how to stop the bulldozer before the vote.
Urmas Reinsalu
Profiling Isamaa fraktsioonAI Summary
Urmas Reinsalu said that Estonian people see through the rhetoric and the spider's web that is being imposed on them, and Isamaa defends Tallinn's people and businesses from tax increases with temporary measures, emphasizing that a tax increase in Tallinn is unacceptable and that it is important to give people a clear signal, where the first signal came in the European Parliament elections and the second will come with the October local government elections.
Aseesimees Arvo Aller
AI Summary
The vice-chairman Arvo Aller invited Jaak Aab to speak.
AI Summary
Jaak Aab notes that he does not see a sudden increase in the land tax, and Tallinn has also decided not to raise it, but he asks whether we trust local government leaders who have greater decision-making power and financial autonomy, or are we afraid that they will saddle everyone with a large increase in the land tax.
Urmas Reinsalu
Profiling Isamaa fraktsioonAI Summary
In his speech, Urmas Reinsalu stated that in Tallinn a tax increase must still be made, and people will be paid back money along the same trajectory, but the main problem is the small size of Estonia's economy and the government's loss of credibility, to which Isamaa responds with its own alternative budget and emphasizes that diagnosis-based correct steps are critically important.
Aseesimees Arvo Aller
AI Summary
Riina Solman asked the chair of the meeting a question.
Riina Solman
Profiling Fraktsiooni mittekuuluvad Riigikogu liikmedAI Summary
Riina Solman comments on the Riigikogu's rules of procedure and working order, recalls that she was Minister of Public Administration after Jaak Aab, and notes that local government leaders did not want to increase their revenue base with the land tax, but to receive a larger share of individuals' personal income tax, which was taken from them during the 2009 crisis and has not been restored to this day.
Aseesimees Arvo Aller
AI Summary
A rebuttal can be made only when your name is mentioned during the negotiations, and at the moment his question was directed to the presenter and the presenter answered it; Rain Epler, please.
Rain Epler
Profiling Fraktsiooni mittekuuluvad Riigikogu liikmedAI Summary
Rain Epler refers to Jaak Aab's earlier support for imposing a cap on the tax increase and its later removal, and asks Urmas how such deceitful policy affects citizens' trust in the state and security in a complex geopolitical era, and what he would advise to the people.
Urmas Reinsalu
Profiling Isamaa fraktsioonAI Summary
Urmas Reinsalu accuses the government of breaking its promise and increasing the tax burden, stressing that the pledge given in the 2023 mandate against a land tax increase has been broken, and the coalition must prove or disprove the projected up to 38% tax increase in 2025 and the potential greater impact by 2026 in order to restore trust.
Aseesimees Arvo Aller
AI Summary
Jaak Aab posed a question to the chair of the session.
Urmas Reinsalu
Profiling Isamaa fraktsioonAI Summary
Urmas Reinsalu expressed firm support for Jaak and said that it is right to give him two minutes to speak in the interests of the Parliament's culture.
Aseesimees Arvo Aller
AI Summary
No interjections may be made; I will listen to what you have to say to the chair.
Urmas Reinsalu
Profiling Isamaa fraktsioonAI Summary
Urmas Reinsalu asks that this be completed within two minutes.
Aseesimees Arvo Aller
AI Summary
Time decides Jaak himself.
Aseesimees Arvo Aller
AI Summary
Vice-chairman Arvo Aller said that the content of the speech is correct and perhaps historically accurate, and this could also be said during the negotiations if Andres Metsoja comes to the podium to speak as a representative of the Social Democratic Party.
Andres Metsoja
Profiling Isamaa fraktsioonAI Summary
The presenter asks whether the 65 million euros distributed after the 2017 administrative reform (about 22 million per year) constitutes a price tag for municipal residents and entrepreneurs — i.e., is the land tax the cost of implementing this reform.
Urmas Reinsalu
Profiling Isamaa fraktsioonAI Summary
Urmas Reinsalu emphasizes that additional taxes are created at the expense of the people by the government and through local authorities, and he calls on leaders to take the lead, not to whine about the past, to distinguish what is important from what is unimportant, and to pursue policies that meet society's expectations.
Aseesimees Arvo Aller
AI Summary
Vice-Chair Arvo Aller thanks the presenter and now asks the leading committee to present the discussion and the emotional experiences that took place in the Finance Committee regarding Riigikogu member Priit Lombi.
Priit Lomp
AI Summary
Priit Lomp spoke about the local government property tax topic, refuted the 38% accounting exaggeration, and said that the maximum rate is set by the councils and that the total cost for entrepreneurs and residents is very small; he criticized Isamaa members and local leaders for their behavior, called for an honest substantive discussion and greater cooperation, recommended Urmas to join the Finance Committee, and announced three decisions: the draft will be placed on the plenary agenda on November 5, a representative will be designated in the leading committee as the speaker, and the Finance Committee recommended rejecting the draft (7 in favor, 2 against).
Aseesimees Arvo Aller
AI Summary
The vice-chairman Arvo Aller gave an overview, and questions arose, to which Rain Epler was asked to respond.
Rain Epler
Profiling Fraktsiooni mittekuuluvad Riigikogu liikmedAI Summary
Rain Epler emphasized that tax autonomy is not granted to local governments, and the maximum amounts and the limits on residents' support are established by law, and he asked whether the commission discussed granting tax autonomy to local governments.
Priit Lomp
AI Summary
Priit Lomp said that although the discussion of the draft was brief and covered many topics, the tax in force cannot be set to zero, and the residential land tax exemption must remain within the range of 5–1000 euros, which is justified by technical logic and the explanation of a specialist from the Tax and Customs Board.
Aseesimees Arvo Aller
AI Summary
The vice-chairman Arvo Aller asks Urmas Reinsalu to speak.
Urmas Reinsalu
Profiling Isamaa fraktsioonAI Summary
Urmas Reinsalu criticized the logic surrounding the tax-free minimum, noted that eight stakeholder groups did not support the bill, and asked how much additional land tax will be collected in 2025 and in 2026 after the phased implementation comes into effect, based on the 2025 budget bill and the coalition's analysis.
Priit Lomp
AI Summary
Priit Lomp notes that although official information promises a 38% rise in land tax rates for 2025, local municipalities have often set much lower rates (for example, 0.2–0.5%), and these were not taken into account in the budget proposal, and the dispute can be continued a year later when we see actual revenue collection.
Aseesimees Arvo Aller
AI Summary
The vice-chairman Arvo Aller invites Madis Kallas onto the stage.
Madis Kallas
Profiling Fraktsiooni mittekuuluvad Riigikogu liikmedAI Summary
Madis Kallas asked whether the commission discussed giving local governments greater freedom to raise the land tax, and he stressed that the decision should remain at the local level, and it has received positive feedback among local governments.
Priit Lomp
AI Summary
Priit Lomp said that in the most recent discussion of the draft bill the speaking time was noticeably restrained, and the Riigikogu's composition has not yet thoroughly debated it, emphasizing that the autonomy of local government authorities and the issue of land tax are important for municipalities, and that the discussion should have taken place with Urmas's presence, so that the draft bill would not become a waste of time in the committee.
Aseesimees Arvo Aller
AI Summary
Deputy chairman Arvo Aller asks Urmas Reinsalu to take the floor.
Urmas Reinsalu
Profiling Isamaa fraktsioonAI Summary
Urmas Reinsalu said in the committee that an increase in land tax is unconstitutional, unnecessary and unpredictable, and asked Lomp how large the tax burden on people and entrepreneurs would rise and what the prerequisites for the vote were.
Priit Lomp
AI Summary
Priit Lomp said that the 20-year delay in the regular land valuation creates inconsistencies, and property-based taxation does not fit for governing the Estonian state, because the number of properties is too large and the calculation will likely be approximate; however, municipalities and some Riigikogu politicians have not abused trust, and tax revenue is not significantly lower.
Aseesimees Arvo Aller
AI Summary
Riina Solman asked the chair of the session a question.
Riina Solman
Profiling Fraktsiooni mittekuuluvad Riigikogu liikmedAI Summary
Riina Solman said that during her tenure she did not bring up the idea of a land tax, and in the regions they talked about the local government's revenue base, focusing on the equalization fund, personal income tax, and attracting entrepreneurs.
Aseesimees Arvo Aller
AI Summary
During negotiations, you must state all of your positions and reveal what was said at the meetings.
Priit Sibul
Profiling Isamaa fraktsioonAI Summary
Priit Sibul asks the chair of the meeting and the presenter whether the actual extent of the land tax increase is known, whether the problems with the equalization fund calculator have been resolved, and whether real data will be shown.
Priit Lomp
AI Summary
During the discussion, calculators for land tax and the equalization fund were discussed, and it was mentioned that Urmas floated a formula to deal with the maximum rates.
Aseesimees Arvo Aller
AI Summary
Deputy Chairman Arvo Aller says that the question will be answered.
Priit Lomp
AI Summary
Priit Lomp notes that in calculating the equalization fund, the maximum rate of the land tax may be used, and this should be reviewed so that municipalities are not penalized for using the maximum rate, and that the regional minister would pay attention to this issue to ensure the financial autonomy of local governments, and adds that in the discussion of the 2022 RES budget strategy the regional minister did not present any proposals for changes to regional policy.
Aseesimees Arvo Aller
AI Summary
Vice-Chairman Arvo Aller ended the question period, thanked everyone, and announced that Urmas Reinsalu would now pose a question to the chair.
Urmas Reinsalu
Profiling Isamaa fraktsioonAI Summary
Urmas Reinsalu asked Mr. Aller a question about the possibility of changing the equalization fund formula and the maximum rate of the rural-area land tax, and asked whether that formula would be brought up for discussion in the annex to the 2025 State Budget Act.
Aseesimees Arvo Aller
AI Summary
Arvo Aller said that the current formula discussion does not align with the way the meeting is being chaired, and it will be reviewed the day after tomorrow, and Priit Lomp posed a question to the chair of the meeting.
Priit Lomp
AI Summary
Priit Lomp notes that in earlier discussions they are sometimes recalled differently, and the then Minister of Public Administration responsible for regional policy, Solman, did not bring proposals related to regional policy to the state's budget strategy discussion, but instead presented other priorities, and finally asks whether, as the chair of the meeting, he often encounters similar difficult situations as Reinsalu.
Aseesimees Arvo Aller
AI Summary
Vice Chairman Arvo Aller confirms that he can be in the room, listen and ask questions, and will open negotiations, and the first to speak will be Rain Epler on behalf of EKRE.
Rain Epler
Profiling Fraktsiooni mittekuuluvad Riigikogu liikmedAI Summary
Rain Epler emphasizes that the cap set after the land appraisal for the increase of the land tax must be restored, and not moved, because changing the cap affects primarily the residents of rural areas and agricultural entrepreneurs, and behind the rise in land prices there is money printing and subsidies for renewable energy, whose impact requires correction.
Aseesimees Arvo Aller
AI Summary
The vice-chairman Arvo Aller asks for three more minutes.
Rain Epler
Profiling Fraktsiooni mittekuuluvad Riigikogu liikmedAI Summary
Rain Epler criticizes the coalition's tax policy, arguing that tax increases (such as value-added tax and the vehicle tax) and the removal of income tax allowances for children primarily affect those who are already struggling, and he calls for reinstating a cap on tax growth, because it is cynical and false.
Aseesimees Arvo Aller
AI Summary
The deputy chair Arvo Aller announces that the requests to speak have been completed and the discussions are closed, and asks Priit Lomp to submit a question to the chair of the meeting.
Priit Lomp
AI Summary
Priit Lomp said that he watched the session closely and would have liked to say something, but there wasn't enough time, and in the end there wasn't any new information to come out of it.
Aseesimees Arvo Aller
AI Summary
The deputy chairman Arvo Aller asked whether you have a reply speech to Rain Epler or if you currently have a question for the chair of the meeting, and Priit Lomp answered yes.
Priit Lomp
AI Summary
Priit Lomp said that the negotiations have ended and that we must go to a vote, because there is no new information and he has come to help explain the process.
Aseesimees Arvo Aller
AI Summary
Deputy Chairman Arvo Aller admitted that he did indeed say that he would close the negotiations, but the names on the screen showed that the negotiations have unfortunately ended.
Riina Solman
Profiling Fraktsiooni mittekuuluvad Riigikogu liikmedAI Summary
Riina Solman gave feedback on the work and home rules, noting that she had not noticed any request to speak and that the negotiations had already been closed, and that she would have liked to present a response speech.
Aseesimees Arvo Aller
AI Summary
Vice-Chair Arvo Aller announced that the negotiations have ended and that the Steering Committee's proposal to reject Bill 489 at its first reading would be put to a vote, and he asked to begin the voting.
Aseesimees Arvo Aller
AI Summary
Thirty-five members of the Riigikogu voted in favor of the proposal; 12 were against, and 0 abstained. Draft Bill 489 has been rejected and removed from consideration, and the fourth item on the agenda has been completed.