Ligi to Reintroduce Bill for Cutting VAT Deductions on Cars ({{commentsTotal}})

Source: Photo: ERR

The Cabinet is standing firm on its pledge to abolish VAT deductions on company cars, saying the related tax revenue is already priced into the 2014 budget.

Jürgen Ligi's Finance Ministry said on Wednesday that it would re-submit the bill to other ministries even after it was tabled in Parliament several weeks ago.

"The Cabinet does not support a car tax, but has been unanimous in that the tax break for passenger cars must be restricted if the car is bought in the name of a company and is also used for personal purposes," Ligi said on

"In putting together the budget, this amendment was directly linked with a gap in funding for roads."

The amount in question is 24 million euros.

IRL and Reform Party MPs said upon tabling the bill two weeks ago that they would support raising the money by selling off state assets and increasing dividends at state companies, but Ligi demurred.