IRL's €500 Tax-Free Idea Is Progressive Tax, Say Opponents ({{commentsTotal}})

Source: Photo: Postimees/Scanpix

The three other political parties in Parliament say IRL's idea to abolish tax for people earning 500 euros or less is disguised progressive tax.

Social Democrat Rannar Vassiljev said the proposal is very technical and IRL itself would struggle to explain it fully, adding that he welcomes IRL into the club of parties supporting a progressive tax system.

Center Party deputy chairman Kadri Simson said IRL has been increasing the tax burden of those who have earned less and the idea is duplicitous. Simson said it is not clear where the 120 million euros necessary for the reform will come from.

“The first view is that it would be very expensive,” finance minister Jürgen Ligi said, adding that IRL has crunched the numbers incorrectly and it would be far more expensive than the 120 million euros.

IRL proposed abolishing income tax on salaries lower than 500 euros per month at a party congress over the weekend.

The move is surprising as IRL is a right-wing party, and whose former chairman, Mart Laar, pushed the current flat tax system when he was prime minister in 1992.