These would include gifts to hospitals, social welfare institutions and state and local government agencies, BNS reports.

The amendments have been included in a bill being handled by the Riigikogu which seeks to amend laws pertinent to the supplementary budget introduced by the government to mitigate economic fallout from the coronavirus crisis. The budget itself passed its first reading at the Riigikogu, with its second and third readings to follow next week.

"Many Estonian businesses have expressed a wish to support hospitals and local agencies in their fight against the coronavirus during the present difficult time," Minister of Finance Martin Helme (EKRE) said.

"To make sure as many resources find their way to these agencies as possible, we will exempt entrepreneurs from paying income tax on donations and gifts during the emergency situation," Helme went on, according to BNS.

Under ordinary circumstances, donations are tax exempt if they are made to charitable public interest non-profit associations and foundations, as listed by the Tax and Customs Board (MTA).

Many health care institutions however, are registered as businesses, according to BNS, which would make them off-limits for tax exemption donation status in the normal run of things.

For example hospitals, despite being foundations working in the public interest, engage in economic activity and not charity, meaning businesses donating to hospitals would normally need to pay income tax on their donation.

In the present situation the state deems it appropriate to exempt such donations from income tax, however, BNS reports.

Should the amends enter into force, charitable gifts and donations made by legal persons to state or local government agencies, social welfare institutions and managers of hospitals would be tax-exempt.

The status would be back-dated to the start of the emergency situation, March 12, and run to July 1 as things stand.

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