Government approves state budget for 2016 (3)
Estonian government approved the draft bill for the next year’s Estonia’s state budget, which will be presented to the Parliament on Tuesday.
At 8.9 billion euros, the state budget is expected to increase by 4.2 percent compared to this year. Revenues are estimated to be 8.8 billion euros, while expenditure will be slightly higher for the second year in a row.
Tax burden will remain approximately on this year’s levels, at 33 percent.
The government is planning to increase the payroll by 4 percent for the social workers, teachers, and those working in cultural activities, as well as for police and internal security employees. The pensions will also increase, on average by 5.5 percent.
Defense expenditure will rise by 9 percent and at 2.07 percent of the GDP, will exceed the suggested NATO minimum requirement. On top of this, the costs associated with accommodating allies in Estonia will be added to the defense budget.
20 million euros will be allocated to secure the eastern border with Russia and extra funds will be granted to reinforce the internal rapid reaction forces.
Child allowances will also grow – for the first and second child 50 euros per month each and 100 euros for the third and more children.
The tax-free income will increase from 154 euros per month to 170 euros, or 2,040 euros per year.
The government is planning to invest 307 million euros into road building and reconstruction.
To cut costs, 750 people will be made redundant from the public sector, saving 13 million euros for the state.