Draft law amending the Value Added Tax Act (539 SE) - First Reading
Session: 15th Estonian Parliament, 5th session, plenary session.
Date: 2025-01-22 18:32
Participating Politicians:
Total Speeches: 54
Membership: 15
Agenda Duration: 1h 3m
AI Summaries: 54/54 Speeches (100.0%)
Analysis: Structured Analysis
Politicians Speaking Time
Politicians
Analysis
Summary
The discussion focused on the first reading of bill 539, amending the value-added tax law, initiated by the Conservative People's Party of Estonia. The bill’s aim is to reduce the value-added tax on food for all food products, in order to ease people's coping and compensate for the effects of inflation. Rain Epler gave a presentation, pointing out that Estonia’s food basket is higher compared to Europe, and if the value-added tax were to reach 24% or if there were no exemptions, the global price level would increase, and such a change could appear as a significant blow to the consumer. At the same time, the nuances of the overall tax base, its simplicity, and the risks of fraud were also discussed, and it was considered that a general approach without excessive exemptions would be less bureaucratic and potentially fairer.
The second section addressed the views of the finance sector, attitudes towards practices in other countries (Germany, Finland, Belgium, Ireland, etc.) and the alleged impact on the state budget. The discussion brought up the coalition and the opposition, as well as ineffective claims about tax preferences, and raised the question of how to reach a better solution without undue influence. Finally, it was necessary to coordinate the procedure: it was decided unanimously to put the bill on the agenda of the plenary session and to appoint Rain Eler (the speaker's role) as the leading committee. At the end of the entire procedure, two important observations emerged: the proposal to reject the first reading of the bill and the result of the vote.
Final decision: The first reading of bill 539 was constitutionally rejected, with 53 votes in favor, 17 against, and no abstentions. This meant that the bill did not finally receive approval in the previous session for the first reading.
Decisions Made 1
Bill 539's first reading is postponed. The vote result: 53 in favor, 17 against; there were no abstentions. The leading committee's proposal takes effect, and the procedure continues according to the Riigikogu's process.
Most Active Speaker
The most active speaker was Rain Epler (VrDPwHs2xBs), a member of the Estonian-EKRE faction; he represented the right wing (or "far-right") and delivered several speeches during the debate on the first reading of bill 539, highlighting the effects of tax changes as well as European experiences.
Aseesimees Toomas Kivimägi
AI Summary
The first reading of Draft Bill No. 539 on amendments to the Value Added Tax Act, initiated by the EKRE faction, is before the Riigikogu, and Rain Epler has been asked to serve as the rapporteur.
Rain Epler
Profiling Fraktsiooni mittekuuluvad Riigikogu liikmedAI Summary
Rain Epler explains that the aim of the bill is to lower the entire value-added tax on food in order to improve people's ability to cope during inflation, explains why it is not sensible to favor domestic food, provides examples from other countries' practices, and calls on all political forces to support this bill.
Aseesimees Toomas Kivimägi
AI Summary
Vice-Chairman Toomas Kivimägi thanked the presenter for a very effective and substantive presentation and invited questions, saying: Siim Pohlak, please!
Siim Pohlak
Profiling Eesti Konservatiivse Rahvaerakonna fraktsioonAI Summary
Siim Pohlak says that tax cuts work to the benefit of consumers, recalls the €0.99 diesel price from the EKRE era, and criticizes the government for ignoring European examples on food VAT, and asks why the Social Democrats have disappeared from the chamber.
Rain Epler
Profiling Fraktsiooni mittekuuluvad Riigikogu liikmedAI Summary
Rain Epler criticizes the fact that foolish mistakes are often made in European politics in energy policy and in strengthening defense capabilities, and our governments copy these bad ideas; he emphasizes how important it is to monitor the impact of the new U.S. administration and calls on the coalition to join this initiative in order not to lose competitiveness.
Aseesimees Toomas Kivimägi
AI Summary
This is a plea to invite Rene Kokk.
Rain Epler
Profiling Fraktsiooni mittekuuluvad Riigikogu liikmedAI Summary
Rain Epler pointed out that in the discussion on car tax, questions and Aivar Koka's answers showed how much money is being wasted, and if wasteful spending is set aside, there should be no need to raise taxes; but the Social Democrats' quick learning seems impractical, and Piret Hartman's comment shows that they do not intend to support this idea, although the Social Democrats' freedom to act within their mandate may still offer some hope.
Aseesimees Toomas Kivimägi
AI Summary
The speech begins by inviting Arvo Alleri to perform.
Arvo Aller
Profiling Fraktsiooni mittekuuluvad Riigikogu liikmedAI Summary
Arvo Aller claims that lowering the fuel excise tax was once effective, because more fuel went into the tanks than money circulated, but now the situation is the opposite, and lowering VAT is, in his words, a pure security measure, because a full stomach and quality food foster patriotism and show that the state cares.
Rain Epler
Profiling Fraktsiooni mittekuuluvad Riigikogu liikmedAI Summary
Rain Epler claims that economic hardship and the emigration of people are security issues, because cold and an empty stomach erode patriotism, and more and more people are thinking of leaving Estonia, and he invites coalition MPs to join in his good initiative.
Aseesimees Toomas Kivimägi
AI Summary
Toomas Kivimägi thanked the esteemed presenter, noting that there are no more questions, and informed that the discussion and decisions in the steering committee will be presented by the chair of the Finance Committee, Annely Akkermann.
Annely Akkermann
Profiling Eesti Reformierakonna fraktsioonAI Summary
The Finance Committee discussed the draft, but the government decided not to support it, because its implementation would bring at least 400 million euros into the state budget per year and would not increase VAT revenue, and the committee decided to take the draft to the plenary, and the motion to reject the draft received five votes in favor and three against.
Aseesimees Toomas Kivimägi
AI Summary
The vice-chairman Toomas Kivimägi thanks the audience, says that there are a few questions, and invites Arvo Alleri to take the floor.
Arvo Aller
Profiling Fraktsiooni mittekuuluvad Riigikogu liikmedAI Summary
Arvo Aller criticizes the government's plan for a unified tax system and the implementation of the full value-added tax on expensive foods, arguing that a 400-million decrease in revenue affects the budget, not people's ability to make ends meet, and rhetorically asks why exceptions cannot be made for food and why we should apply the full VAT on food.
Annely Akkermann
Profiling Eesti Reformierakonna fraktsioonAI Summary
The message of the presentation is that reducing the value-added tax on food is not a universal solution to reducing poverty, and in balancing the state budget one should primarily use social transfers for vulnerable people rather than tax incentives.
Aseesimees Toomas Kivimägi
AI Summary
This is an invitation to Lauri Laats to come onto the stage and perform.
Lauri Laats
Profiling Eesti Keskerakonna fraktsioonAI Summary
Lauri Laats notes that Estonia's share of consumption taxes is 43% of total tax revenue, higher than the European average of about 30%, and he recommends lowering the VAT on foodstuffs, because the practice in Ireland and other countries shows that this increases consumption and stimulates the business environment.
Annely Akkermann
Profiling Eesti Reformierakonna fraktsioonAI Summary
The presentation highlights multifaceted problems: the environment's biggest concern is the generation of food waste and overnutrition, and tax policy affects consumers' spending; if a reduction of the value-added tax on food to the extent of 400 million euros is planned, it must be clearly shown where this budget shortfall will be offset, because the bill does not explain this, and this is one of its weaknesses.
Aseesimees Toomas Kivimägi
AI Summary
The vice-chairman Toomas Kivimägi invites Rene Kokk to speak.
AI Summary
Rene Kokk criticizes the stance that distributing food money is the right solution, and recommends replacing it with a reduction of VAT on food products, arguing that most EU countries do so and the aim is to help people cope on their own, not to create a culture of dependency or begging.
Annely Akkermann
Profiling Eesti Reformierakonna fraktsioonAI Summary
In order for social transfers to be effective, they must be funded from tax revenue, because the elderly, people with disabilities, and children who do not work need support; reducing the value-added tax on food will not help them, but would benefit higher incomes, and therefore one should focus on social benefits; as in the example of Germany, foods are divided into basic goods and luxury goods, but the complexity of the tax system itself costs money, and I have no better solution.
Aseesimees Toomas Kivimägi
AI Summary
The vice-chairman Toomas Kivimägi asks Rain Epler to give a better answer.
Rain Epler
Profiling Fraktsiooni mittekuuluvad Riigikogu liikmedAI Summary
Rain Epler criticizes the Reform Party's tax policy as rhetoric that begins with the need for security and the state budget, and in response to objections turns to nature protection and changing people's behavior, and asks which is their real aim: a high VAT on food or larger state budget revenues.
Annely Akkermann
Profiling Eesti Reformierakonna fraktsioonAI Summary
Annely Akkermann emphasizes that tax revenue collection for the state budget is important, and the draft proposing to reduce revenue by 400 million euros per year is not acceptable, because it does not provide a substitute and would increase inequality, benefiting those with higher incomes more and harming those who really have little money, and maintaining budget balance is important.
Aseesimees Toomas Kivimägi
AI Summary
The deputy chairman Toomas Kivimägi invites Vladimir Arhipov onto the stage.
Vladimir Arhipov
Profiling Fraktsiooni mittekuuluvad Riigikogu liikmedAI Summary
Vladimir Arhipov is criticizing the coalition, asking why such nice people make unpleasant decisions and why relief is not provided to people who are in hardship, arguing that the subsistence allowance is ridiculous.
Annely Akkermann
Profiling Eesti Reformierakonna fraktsioonAI Summary
Annely Akkermann said that VAT relief for recipients of the subsistence benefit would not provide significant help, and the real solution lies in collecting VAT and raising the subsistence threshold and the cap on the basic pension.
Aseesimees Toomas Kivimägi
AI Summary
Alexander Chaplogin is invited to take the floor.
Aleksandr Tšaplõgin
Profiling Fraktsiooni mittekuuluvad Riigikogu liikmedAI Summary
He raises the question of whether cheap food is really bad and expensive food is good.
Annely Akkermann
Profiling Eesti Reformierakonna fraktsioonAI Summary
Annely Akkermann emphasizes honesty and notes that the price of food contains more components than VAT, and mentions that in Germany a distinction is made between basic foodstuffs and luxury foodstuffs, illustrating the different categories of food.
Aseesimees Toomas Kivimägi
AI Summary
The vice-chairman Toomas Kivimägi invited Siim Pohlaki to speak.
Siim Pohlak
Profiling Eesti Konservatiivse Rahvaerakonna fraktsioonAI Summary
Siim Pohlak criticizes the idea that food VAT should be high, noting that it restricts consumption and health and resembles the logic of reducing cars, and argues that the real problem lies in economic policy, which causes job losses and a need for assistance, and that the solution should be an environment where assistance is not needed.
Aseesimees Toomas Kivimägi
AI Summary
The vice-chairman thanks everyone.
Siim Pohlak
Profiling Eesti Konservatiivse Rahvaerakonna fraktsioonAI Summary
The speech accuses you of leading society into a state of helplessness, in order to then distribute euros to them, and asks you to answer these questions.
Annely Akkermann
Profiling Eesti Reformierakonna fraktsioonAI Summary
Annely Akkermann affirms that the Reform Party's policy is liberal and respects individual freedoms and responsibilities, emphasizing that unemployment is low and people can upgrade their skills, for example by retraining, and that food must be accessible.
Aseesimees Toomas Kivimägi
AI Summary
Toomas Kivimägi thanks the audience, closes the Q&A round, opens negotiations and invites Aleksandr Chaplogin to take the floor on behalf of the Estonian Centre Party faction.
Aleksandr Tšaplõgin
Profiling Fraktsiooni mittekuuluvad Riigikogu liikmedAI Summary
The Centre Party faction wants to lower the value-added tax on food, arguing that price increases have made food items a luxury for many people, and to cover the decrease in budget revenues with a solidarity tax on the profits of banks and multinational corporations.
Aseesimees Toomas Kivimägi
AI Summary
The speech expresses great gratitude, and on behalf of the EKRE faction, colleague Rene Kokk presents a request.
AI Summary
Rene Kokk said that lowering the value-added tax on groceries to 5% is essential for protecting against inflation and people’s wallets, citing the different tax rates among European Union member states and also the Estonian Chamber of Agriculture and Commerce’s proposal.
Aseesimees Toomas Kivimägi
AI Summary
The vice-chairman, Toomas Kivimägi, asks for three more minutes.
AI Summary
Rene Kokk notes that support measures tend to favour those who can cope better on their own (for example, a 4,000-euro subsidy for an electric car), which could harm the future prospects of young people and is a major security-related issue, and emphasizes EKRE's position: lowering the value-added tax on food to 5% is essential and helps both people and businesses.
Aseesimees Toomas Kivimägi
AI Summary
The most anticipated speech of the day is by Andre Hanimägi on behalf of the Social Democratic Party faction, because there have been many appeals and expectations, and now we have the opportunity to listen to him.
Andre Hanimägi
Profiling Fraktsiooni mittekuuluvad Riigikogu liikmedAI Summary
Andre Hanimägi stressed that the impact of lowering the value-added tax on food products must be thoroughly analyzed and considered across different food groups, because 400 million euros will affect the state budget, and the impact must reach the consumer, not the merchant.
Aseesimees Toomas Kivimägi
AI Summary
The speech contains only one sentence: "Three minutes".
Andre Hanimägi
Profiling Fraktsiooni mittekuuluvad Riigikogu liikmedAI Summary
Andre Hanimägi said that food prices are high, the draft bill offers no solutions and downright ridicules the topic, and if we want to lower the VAT on groceries, we must think carefully about how it will actually benefit people.
Aseesimees Toomas Kivimägi
AI Summary
Toomas Kivimägi thanks you very much and announces that he will continue to take the floor first, because the next speech may touch on the positions of some colleagues, and on behalf of the Reformierakonna faction Anti Haugas is asked to speak.
Anti Haugas
Profiling Fraktsiooni mittekuuluvad Riigikogu liikmedAI Summary
Reducing VAT on groceries does not often have a significant impact on the end consumer, and for the state it is costly and inefficient — therefore it is more sensible to focus on targeted and effective measures that truly reach those in need.
Aseesimees Toomas Kivimägi
AI Summary
This is the response speech on behalf of the Estonian Centre Party faction, delivered by Lauri Laats.
Lauri Laats
Profiling Eesti Keskerakonna fraktsioonAI Summary
In his presentation, Lauri Laats emphasizes that cutting the value-added tax on food is necessary to ease purchasing power and stimulate consumption, which is vital for economic growth, because the tax burden on food in Estonia is too high, and the impact must be ensured to reach the end consumer through state regulation.
Aseesimees Toomas Kivimägi
AI Summary
Rain Epler represents the EKRE faction and asks to be given the opportunity to deliver a reply.
Rain Epler
Profiling Fraktsiooni mittekuuluvad Riigikogu liikmedAI Summary
Rain Epler said that they did not intend to create a system where people could reclaim VAT from the state, explained that the exemptions in European VAT rules are known and the rates have changed over time and can be improved with amendment proposals, and emphasized that the state and businesses must work together and pass the benefits on to consumers, especially in the run-up to local elections.
Aseesimees Toomas Kivimägi
AI Summary
The vice-chairman Toomas Kivimägi announces that there is no provision for a reply to a reply, closes the negotiations and puts to a vote the Steering Committee's draft proposal No. 539 to reject it at the first reading.
Aseesimees Toomas Kivimägi
AI Summary
53 Riigikogu members voted in favour of the proposal, 17 against and there were no abstentions; the bill 539 was rejected and fell out of the proceedings, and Toomas Kivimägi noted that the leadership had been too lenient and had allowed too many points, promising to avoid similar mistakes next time.