Gambling tax proceeds may be paid straight into state coffers
The finance ministry has drafted legislative amendments which would place tax take from gambling in Estonia straight into stat revenues, rather than being apportioned to specific ministries as has been the case.
Revenues from gambling taxation are often used to fund social programs; the finance ministry says that the pandemic has led to a fall in tax take and has revealed shortcomings in the existing system.
Justice minister Maris Lauris (Reform) said that: "In general, speaking of the state budget, we follow the principle that individual items of revenue and expenditure should not be dependent on one another, as revenue as a whole should be meant for the financing of expenditures."
"This increases flexibility in decision-making and reduces the risks associated with the economic environment," Lauri, who is deputizing for finance minister Keit Pentus-Rosimannus, continued.
The pandemic has shown that distributing money in line with the percentage of receipts does not work in situations where gambling tax revenue slumped dramatically.
The legal amendments, the Gambling Tax Act, have been finalized at the finance ministry, and will be put to the Riigikogu for voting.
Should the legislation pass, gambling tax revenues will in the future be transferred to general state revenues.
Under the Gambling Tax Act as things stand, fixed percentages go to the Cultural Endowment, along with four ministries, in order to finance specific areas as set out in law.
For 2022-2025, funds to be allocated to the ministries will remain at the level set out in the 2021 spring forecast, and will not automatically change in the event of a rise or fall in tax revenue.
The Cultural Endowment's financing model will not change, however.
That fund receives a little under 50 percent of revenue from gambling tax as paid into the budget.
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Editor: Andrew Whyte