Brussels Recommends Estonia Lower Tax Burden on Poor
The European Commission has called on Estonia to reduce income taxes on low and medium income earners.
That bit of prodding came in a package of country-specific recommendations delivered to each of the 27 EU member states on June 7 as part of efforts to better coordinate the economic policies across the bloc.
Cutting the income tax and social tax burden on those with below average income will help boost labor demand and curb poverty risks, the commission said in its assessment.
The commission also suggested that the country concentrate its labor market efforts on young and long-term unemployed and, while carrying out its education reforms, give priority to pre-school and vocational education. The focus, it said, should be on making sure that the education system is meeting labor market needs, and that low-skilled workers have a chance to take part in life-long learning programs.
Other recommendations included reaching a balanced budget by 2013 and work towards increasing energy efficiency in the construction and transport sectors.
Each member state is expected to make fulfilling the recommendations a priority over the next 12 to 18 months, with the main incentives being peer pressure and market pressure.
Steve Roman