Opinion digest: Siim Kallas thinks real estate tax effective way to finance local government (5)
The Reform Party’s presidential candidate, Siim Kallas, said in an opinion piece published in daily Postimees that an estate tax, more precisely a tax levied on real estate, could be considered to finance local government.
Kallas pointed out that the financing of parishes and city districts was based on the redistribution of income tax, but that there was no estate tax like it was common in plenty of other countries. There, the revenue from such a tax made up a considerable amount of the funding available to local government.
“A real estate tax can be an effective means in local politics. In richer areas, the tax could be higher, in poorer areas it could be low, or not raised at all,” Kallas said.
In Kallas’ opinion, sales and use taxes like local governments in the United States have them would be an option as well. With such a tax, events like summer festivals, sports events, and so on could turn into a source of additional income for municipalities.
This again could work as an incentive for local government to create the conditions for such events, both in terms of permanently present as well as temporary business. Kallas added that any such tax couldn’t come as an addition to existing taxes, but only in combination with lowering some other tax, or a very clear benefit offered to people.