The impact of tax policy
Session: 15th Estonian Parliament, 5th sitting, information briefing
Date: 2025-01-29 14:12
Participating Politicians:
Total Speeches: 10
Membership: 15
Agenda Duration: 14m
AI Summaries: 10/10 Speeches (100.0%)
Analysis: Structured Analysis
Politicians Speaking Time
Politicians
Analysis
Summary
The second agenda item addressed the impact of tax policy, followed by the topics of bank taxation and state defense funding. The first part focused on assessing the impact of tax increases and asking which indicators and initial signs one could expect, and how they would affect people's daily coping. The second part discussed the possibility of a bank tax and its role in funding state defense; the discussion also included searching for funding sources and economic consequences, including what role central funding, loans, and EU funding would play. Overall, participants deemed it necessary to maintain tax stability and seek balanced solutions between state budget and security needs.
The first thematic group emphasized that changes to the tax system are necessary to fund education, healthcare, and security, and that indicators should be monitored regularly (every six months or annually). It was certainly highlighted that the effects of tax flows are not assessable with simple lines, and that tax increases can affect the living environment and consumption. The second thematic group brought out the role of the banking sector in the economy and discussed whether a bank tax could be part of the mosaic of funding sources, while emphasizing that tax stability must be maintained and that the state must find balanced ways to fund its defense and security expenses. In the search for solutions, the potential of central funding, loans, and EU funding was considered, and the possibility of cutting back on some non-institutional expenditures was weighed, in order to ensure a stable budget and the country’s autonomy.
Decisions Made 1
No concrete decisions were made; the discussion continues and more precise analyses and drafts are needed to assess the impact on the state budget and tax system.
Most Active Speaker
The most active speaker was Lauri Laats (Center Party). He spoke three times, and the focus was on the impacts of tax policy and tax peace; the political direction: Center Party (in colloquial language "neither left nor right").
Esimees Lauri Hussar
AI Summary
This is the question presented by Riigikogu member Lauri Laats to Prime Minister Kristen Michal regarding the impact of tax policy.
Lauri Laats
Profiling Eesti Keskerakonna fraktsioonAI Summary
Lauri Laats, a member of the Riigikogu, criticizes energy policy and tax policy, warns against the formation of a tax network, asks to ensure offline payments in emergencies, and asks when the first signs will show the impact of tax increases on people’s day-to-day living.
Peaminister Kristen Michal
AI Summary
Prime Minister Kristen Michal emphasizes that taxes are necessary for the functioning of the state and for funding services and to cover the budget deficit, although this does not bring joy to people, and at the same time confirms that pensions and the minimum wage will rise and poverty will decrease, noting that the budget is in deficit and the tax burden is competitive for Estonia, and that the economic outlook is optimistic with 2.5–3% growth in the coming years.
Esimees Lauri Hussar
AI Summary
Chairman Hussar thanked the audience and gave Lauri Laats the opportunity to ask a clarifying question.
Lauri Laats
Profiling Eesti Keskerakonna fraktsioonAI Summary
Lauri Laats said that the Centre Party supports a bank tax, but condemns motor vehicle tax and registration fees, and noted that these burden especially families with children, and therefore the car tax could be set at a zero rate.
Peaminister Kristen Michal
AI Summary
Prime Minister Kristen Michal stated that the bottlenecks in the motor tax and the bank tax will be addressed, and tax stability will apply through 2027; at the same time, he emphasized greater competition in the financial sector and economic stability, as illustrated by the 2024 corporate income tax receipts of credit institutions, the 2025 rise in the advance corporate income tax, and the decision to consolidate SEB's headquarters in Estonia.
Esimees Lauri Hussar
AI Summary
The chair thanks and announces that colleague Vladimir Arhipov will present an additional question.
Vladimir Arhipov
Profiling Fraktsiooni mittekuuluvad Riigikogu liikmedAI Summary
Vladimir Arhipov spoke about the bank tax and asked whether it could be one instrument to meet the needs of national defense if the precise attainment of the 5% or 7% target is not yet clear.
Peaminister Kristen Michal
AI Summary
Prime Minister Kristen Michal said that Estonia's defense spending must be increased due to the security situation and should reach 5% next year and 5% in the long term (3.7% planned for 2026), with funding sources seen as central funding and loans, together with cuts in other public sector expenditures, and, if necessary, a review of the conditions for European Union funding.
Esimees Lauri Hussar
AI Summary
The chair thanks and announces that today's consideration of the second question is concluded.