State to give €9 million in additional support to maritime sector next year

Taavi Aas (Center).
Taavi Aas (Center). Source: Government Office.

The government is allocating €9.4 million additional support to the maritime sector in 2022, as part of the state budget for next year.

The Riigikogu's finance committee made the amendments, while the budget itself is currently undergoing its third (of three) Riigikogu readings.

Economics affairs and communications minister Taavi Aas (Center) said that: "I am pleased that we have found a way in the finance committee to continue the support next year in the same volume, in order to remain competitive as a maritime state and gradually exit the crisis."

"As with other maritime states, we cannot afford not supporting our shipping enterprises, particularly considering their large contribution to the Estonian economy."

The state will also return €7.7 million-worth of labor taxes to operators of passenger ships next year, in addition to the €9.4 million support, and waterway charges are to stay at 50 percent their pre-pandemic level for next year also.

Aas noted that the arrival of the pandemic was followed by a halt in passenger transport and significant decline in cargo throughflows, with shipping firms' revenues falling 85-90 percent, while full recovery will take more time.

The cuts in the waterway charges, if not implemented, would have resulted in a loss of state revenue of at least €35 million, BNS reports, citing analysis commissioned by the Logistics and Transit Association ( Logistika ja Transiidi Assotsiatsioon), while the reduction meant revenues exceeded expenditures.

The loss of income would have totaled around €18 million last year, but supplementary revenue earned by the state from the growth of cargo volumes exceeded, €16 million, according to an analysis by PricewaterhouseCoopers.

The rates were zero percent April 2020 to March this year, then set at 50 percent from this April.

Cargo volumes dropped by over seven million tons in Riga and Ventspils (Latvia) and in Primorsk (Russia) in 2020, while the Port of Tallinn bucked that trend with the growth over the same period, Aas said.

The Port of Tallinn is part-state-owned and also governs Paldiski's port, west of Tallinn, and Muuga's, to the east.

The state budget bill generally passes in mid-December, shortly before the Riigikogu breaks up for Christmas.

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Editor: Andrew Whyte

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