Draft law (641 SE) for the ratification of the agreement between the Republic of Estonia and the Republic of Botswana for the avoidance of double taxation in respect of income taxes, and for the prevention of tax evasion and fiscal fraud, and of the protocol thereto – first reading
Session: 15th Riigikogu, 5th session, plenary sitting
Date: 2025-05-20 14:12
Participating Politicians:
Total Speeches: 8
Membership: 15
Agenda Duration: 8m
AI Summaries: 8/8 Speeches (100.0%)
Analysis: Structured Analysis
Politicians Speaking Time
Politicians
Analysis
Summary
The agenda item under consideration concerns the draft law 641 for ratification, on the first reading, of the agreement between the Republic of Estonia and the Republic of Botswana for the avoidance of double taxation on income (and its protocol). The draft was introduced by the Minister of Finance, Jürgen Ligi, and the agreement is aimed at ensuring the stability of the tax environment for foreign market companies investing in Estonia, as well as for Estonian businesses expanding to foreign markets. Key aspects of the agreement include the allocation of rights to tax income sources, prevention of tax avoidance, and increased tax control through information exchange. The signing of the agreement on September 25th last year in New York and its basis in the OECD model agreement signals that Estonia continues to accept international tax discussions, adding Botswana to its long-standing list of 63. Important indicators include the taxation of dividends, interest, license fees, and technical or advisory services, as well as special provisions relating to income of government, central banks, or foundations. The agreement's information exchange mechanism is publicly robust, extending beyond the incomes of resident individuals and preventing tax evasion with increasing numbers.
In the second chapter, the importance of the draft concerning the potential for an Africa partnership and the involvement of Botswana, as a country with a growing economy, was considered. Emphasis was placed on the fact that countries desire a modern tax structure that reduces administrative burden and strengthens cooperation, citing Liechtenstein and Andorra as examples of agreements moving towards signature. The commission's discussion raised doubts about the potential future of tax revenues, but emphasized the growth potential of the IT sector and, consequently, the possibility of additional tax revenues. Finally, a consensus was reached to move forward with the draft’s first reading and the plan to place it on the plenary session agenda on May 20th, complete the first reading and appoint Riina Sikkut as the closed representative for the lead commission.
Decisions Made 4
First reading finished.
The draft will be put on the plenary session agenda on May 20, 2025.
Appoint Riina Sikkut as the representative of the committee (Finance Committee).
The deadline for submitting amendments is June 3rd at 5:15 PM.
Most Active Speaker
The most active speaker was Riina Sikkut (pid ceP4u0B31_k) – a member of the finance committee; her presentation and leadership position within the committee reflect an image of the left-wing (left) political spectrum and a strong role in discussions about tax matters.
Esimees Lauri Hussar
AI Summary
Chairman Lauri Hussar announced that today is Botswana Day, and the fourth item on the agenda concerns Bill 641 (first reading) regarding the ratification of the agreement between the Republic of Estonia and the Republic of Botswana for the avoidance of double taxation with respect to taxes on income and the prevention of tax evasion and tax fraud, along with the accompanying protocol. Minister of Finance Jürgen Ligi has taken the floor at the Riigikogu rostrum to present this bill.
Rahandusminister Jürgen Ligi
AI Summary
The Riigikogu is debating the ratification of the income tax treaty and its protocol between Estonia and Botswana. The purpose of this agreement is the avoidance of double taxation, the allocation of taxing rights, the prevention of tax avoidance and tax evasion, the strengthening of information exchange, and the establishment of restrictions on the taxation of dividends, interest, royalties, and technical services under the OECD Model Convention, all aimed at ensuring the stability of the investment environment.
Esimees Lauri Hussar
AI Summary
The Chairman thanks the Minister and announces that the Minister also has questions, before calling upon Lauri Laats to speak.
Lauri Laats
Profiling Eesti Keskerakonna fraktsioonAI Summary
Lauri Laats emphasized that a partnership with African countries could boost mutual trade, especially with Botswana, and sees the potential and future of this market within the IT sector, but simultaneously questioned whose initiative was actually behind it.
Rahandusminister Jürgen Ligi
AI Summary
Finance Minister Jürgen Ligi noted that these initiatives originate from the states, and we must examine the levels of public administration and economic ties, because if these ties do not exist, administrative burden will not arise. Furthermore, Botswana is one of Africa’s most developed countries, and it is worthwhile to cooperate with them, since they are similar to Estonia in some respects, and their flag colors even match.
Esimees Lauri Hussar
AI Summary
Chairman Lauri Hussar expressed his thanks and noted that there were many positive messages for the President of Botswana today. He mentioned the formation of a friendship group after the sitting and asked Riina Sikkut to come to the podium to present the discussion that had taken place in the Finance Committee.
Riina Sikkut
Profiling Sotsiaaldemokraatliku Erakonna fraktsioonAI Summary
Riina Sikkut provided the Finance Committee on May 6th with an overview of the discussion during the preparation for the first reading of the draft bill, emphasizing the importance of avoiding mutual double taxation and preventing tax fraud, and noting the progress of the agreements with Liechtenstein and Andorra, as well as the potential for revenue in the case of the Botswana agreement. Subsequently, the committee decided to place the draft bill on the plenary session agenda for May 20th and appointed Riina Sikkut as the representative of the lead committee.
Esimees Lauri Hussar
AI Summary
Chairman Lauri Hussar announced that the first reading of Bill 641 has concluded, discussions are open, and the deadline for submitting amendments is June 3rd at 5:15 PM.