Draft law (645 SE) for the third reading amending the Simplified Taxation Act for Entrepreneurial Income, the Income Tax Act, and declaring the Security Levy Act invalid.
Session: 15th Riigikogu, 5th session, plenary session
Date: 2025-06-18 19:40
Participating Politicians:
Total Speeches: 26
Membership: 15
Agenda Duration: 35m
AI Summaries: 26/26 Speeches (100.0%)
Analysis: Structured Analysis
Politicians Speaking Time
Politicians
Analysis
Summary
The Riigikogu debated the third reading of Bill 645, initiated by the Government of the Republic, concerning the simplified taxation of business income, amendments to the Income Tax Act, and the repeal of the Security Tax Act, as the fifth item on the agenda. The debate centered on making the government's tax policy permanent and its impact on society. Opposition parties sharply criticized the government for breaking its promises, noting that the increases originally dubbed a temporary security tax (VAT to 24%, income tax to 22%) are being made permanent, while the planned 2% corporate income tax hike is being cancelled. Lauri Laats, representing the Centre Party, accused the government of lacking solidarity, arguing that the tax burden falls disproportionately on the most vulnerable through consumption taxes. The Isamaa faction (Urmas Reinsalu) voted against the bill, citing the deterioration of economic competitiveness and the shrinking of real incomes. Social Democrat Lauri Läänemets stressed that the bill perpetuates a regressive tax system that favors the wealthy and stifles economic growth, and called for the implementation of a progressive income tax. Reform Party representative Annely Akkermann defended the bill, explaining that it leaves more money in the hands of low-income individuals and pensioners through a 2% income tax exemption, and that the overall tax burden will decrease next year due to the abolition of the ‘tax hump’. Following the negotiations, the final vote was conducted.
Decisions Made 1
Bill 645, initiated by the Government of the Republic, concerning the amendment of the Act on Simplified Taxation of Business Income and the Income Tax Act, and the repeal of the Security Tax Act, was adopted as law (46 in favor, 33 against, 0 abstentions).
Most Active Speaker
Lauri Läänemets (Social Democratic Party) was the most active speaker, presenting a comprehensive left-wing critique of Estonia's regressive tax system and the unequal distribution of wealth, which, in his view, is slowing down economic growth.
Aseesimees Arvo Aller
AI Summary
Arvo Aller's statement informed that we are moving on to the fifth item on the agenda, and negotiations with the parliamentary groups will be opened regarding draft bill 645 of the third reading, which addresses the simplified taxation of business income, the amendment of the Income Tax Act, and the repeal of the Security Tax Act. Following this, Lauri Laats will take the floor on behalf of the Estonian Centre Party faction.
Lauri Laats
Profiling Eesti Keskerakonna fraktsioonAI Summary
Lauri Laats is accusing the government of yet another lie, claiming that the VAT and income tax hikes—which were previously dubbed a temporary solidarity security tax—are now being made permanent, while the corporate income tax increase is simultaneously being reversed. This demonstrates that the policies of the Reform Party and Eesti 200 unfairly burden the most vulnerable members of society, completely disregarding solidarity and the Prime Minister's earlier promises.
Lauri Laats
Profiling Eesti Keskerakonna fraktsioonAI Summary
Lauri Laats criticizes the coalition’s tax policy, which makes the tax hikes promised in December permanent, and dubs it a “security tax,” stressing that it burdens low and middle-income people the most and fails to reflect the principle of solidarity.
Aseesimees Arvo Aller
AI Summary
Deputy Chairman Arvo Aller asks if additional time is desired.
Lauri Laats
Profiling Eesti Keskerakonna fraktsioonAI Summary
Lauri Laats simply expressed refusal and thanks.
Aseesimees Arvo Aller
AI Summary
On behalf of the Isamaa faction, Urmas Reinsalu was invited to speak, and he was granted three minutes of extra time.
Urmas Reinsalu
Profiling Isamaa fraktsioonAI Summary
Urmas Reinsalu urged the people of Estonia to embrace change, accusing the coalition's tax policy of driving up prices and shrinking real incomes. He offered the Isamaa alternative: genuine tax peace achieved by halting tax increases, stating that this change will begin with the 2025 local elections and reach its culmination in the 2027 parliamentary elections.
Aseesimees Arvo Aller
AI Summary
The Deputy Chairman thanked [them] and invited Lauri Läänemets to take the floor on behalf of the faction.
Lauri Läänemets
Profiling Sotsiaaldemokraatliku Erakonna fraktsioonAI Summary
Lauri Läänemets asks for three minutes.
Aseesimees Arvo Aller
AI Summary
Deputy Chairman Arvo Aller requests three additional minutes.
Lauri Läänemets
Profiling Sotsiaaldemokraatliku Erakonna fraktsioonAI Summary
Lauri Läänemets claims that the Estonian tax system is regressive, increases inequality, and slows down economic growth, and that there is a need for a progressive income tax and differentiated tax rates (e.g., a 9% VAT on foodstuffs), rather than a uniform tax policy.
Lauri Läänemets
Profiling Sotsiaaldemokraatliku Erakonna fraktsioonAI Summary
Lauri Läänemets sharply criticizes the regressive tax system built by right-wing parties over the past 30 years, a system that has created a situation in Estonia where taxes for the poor are high and those for the rich are low, thereby hindering economic growth and deepening inequality. He emphasizes that since the current tax package continues down this dead-end path, Estonia needs a change of direction and the establishment of a fair progressive income tax.
Aseesimees Arvo Aller
AI Summary
He/She thanks [the Chair] and, on behalf of the Reform Party Faction, requests the floor for Annely Akkermann.
Annely Akkermann
Profiling Eesti Reformierakonna fraktsioonAI Summary
Annely Akkermann explained that the bill reduces income tax by 2% on the first euro for lower-income earners and pensioners, eliminates the Isamaa tax hump, and lowers the tax burden by 1.2 percentage points. It will also put approximately 500 million euros more into the hands of around 590,000 workers, and therefore she strongly urges everyone to support the bill.
Aseesimees Arvo Aller
AI Summary
The address begins with thanks, and on behalf of the faction, Andrei Korobeinik is now asked to deliver his response.
Andrei Korobeinik
Profiling Eesti Keskerakonna fraktsioonAI Summary
Andrei Korobeinik criticizes Annely Akkermann's draft bill as a victory for the Reform Party, pointing out that its tax change will bring in half a billion annually and place a burden on pensioners, and calls for the proposal not to be supported.
Aseesimees Arvo Aller
AI Summary
On behalf of the Isamaa faction, Urmas Reinsalu is requested to deliver a response speech.
Urmas Reinsalu
Profiling Isamaa fraktsioonAI Summary
Urmas Reinsalu claims that the Reform Party's tax policy has increased the tax burden from the planned 33.3% to over 36%, historically returning the country to the tax burden level of 1996. He emphasizes that a comprehensive tax hike is not a tax cut, but rather continued price increases and less money for the public. Meanwhile, Isamaa presented a clear alternative today—a Tax Peace Act aimed at cancelling the planned tax increases—and stresses that the supposed tax relief is not actually taking effect, and that their economic policy fails to support the economy or the financial well-being of the people.
Aseesimees Arvo Aller
AI Summary
Lauri Läänemets delivered a response address on behalf of the Social Democratic Party faction.
Lauri Läänemets
Profiling Sotsiaaldemokraatliku Erakonna fraktsioonAI Summary
Lauri Läänemets (representing the Social Democrats) sharply criticizes the government's tax policy, which he believes favors the wealthy and disproportionately burdens the average Estonian family. He stresses that while taxes are necessary for the state to function, the system must be fair, compel the affluent to contribute their share, and support long-term economic growth, rather than leading the country into a dead end.
Lauri Läänemets
Profiling Sotsiaaldemokraatliku Erakonna fraktsioonAI Summary
I'm unhappy with the VAT increase because the current tax system burdens the average family and favors the accumulation of wealth among the richest. Therefore, we need a fairer system where the wealthy pay their fair share and which supports long-term economic growth.
Aseesimees Arvo Aller
AI Summary
Deputy Chairman Arvo Aller offered his thanks and announced that the time allocated for the response speech had expired, before posing a question to the session chair, Züleyxa Izmailova.
Züleyxa Izmailova
Profiling Fraktsiooni mittekuuluvad Riigikogu liikmedAI Summary
Züleyxa Izmailova expressed concern regarding the strong smell of smoke in the room and requested that the ventilation be improved so that she would not have to sit in smoke, given that she herself is a non-smoker.
Aseesimees Arvo Aller
AI Summary
Deputy Speaker Arvo Aller concluded the debate and, following the proposal of the leading committee, put Bill 645, initiated by the Government of the Republic, to the final vote of the Riigikogu members. This bill concerns the amendment of the Simplified Taxation of Business Income Act and the Income Tax Act, as well as the repeal of the Security Tax Act.
Aseesimees Arvo Aller
AI Summary
Arvo Aller declares the negotiations concluded and submits Draft Bill 645 to the Riigikogu for the final vote. This bill repeals the government-initiated draft law concerning the Law on Simplified Taxation of Business Income, the amendment of the Income Tax Act, and the Law on the Repeal of the Security Tax Law.
Aseesimees Arvo Aller
AI Summary
The Riigikogu passed Bill 645 into law: 46 members of parliament voted in favor, 33 voted against, and there were no abstentions.