New land tax rates revealed in October

Agricultural land.
Agricultural land. Source: ERR

The results of the land valuation undertaken over the past two decades, which will be used to determine land tax in Estonia going forward, will be made public by the end of October, daily Maaleht reports. The land tax value has climbed by 7.2 times over the past two decades to an estimated €28.2 billion.

The daily reports that all 760 000 cadastral units in Estonia would be assigned a price.

In 2024, the state will calculate the land tax based on the updated prices, whereas in 2023, the land tax will continue to be calculated using 2001 data.

The taxable value of the land was determined by the Land Registry based on recent sales in the region.

Regionally, land values have climbed the most in Tartumaa and Hiiumaa over the past two decades, by 15.9 and 13.0 times, respectively.

Veronika Ilsjan, who was in charge of the land valuation project at the land office, explained that the long gap in the assessment has resulted in an unfair situation, where people whose land prices have increased less paying a higher land tax.

In the past, Estonia has undergone three routine audits, in 1993, 1996, and 2001. After that, prices began to grow faster and politicians were hesitant to conduct new valuations because doing so would have definitely resulted in more taxes. Every four years, valuations will be performed going forward.

Currently, the maximum land tax on residential land is 2.5 percent of its property's value, whereas the maximum tax on agricultural property is 0.5 percent. In any one year, the land tax cannot increase by more than 10 percent.

The results of the regular land valuation will be published on the Land Board's website at on October 31.

Municipalities will adopt the new land tax rates no later than July 1, 2023.


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Editor: Kristina Kersa

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