SDE leader calls for progressive-type tax system ahead of 2023 election

In the wake of the recent crises in energy, security and the economy, Estonia's tax system needs overhauling to the extent of bringing in a graduated or progressive model, Social Democratic Party (SDE) leader Lauri Läänemets says.

Speaking at a party board meeting Saturday to unveil SDE's platform ahead of the March 2023 general election, Läänemets, who is also interior minister, said that "Palgad peavad tõusma" ("Wages must rise") was one of the party's basic watchwords.

He also told ERR that the current, outdated tax system should be revamped, with the most important aspect being a boost to the minimum wage and its exemption from income tax. "In order to be able to carry this out, we want to change the current income tax system to a 'normal', three- to four-bracket system," he said.

Part of the rationale for this also lay beyond Estonia's borders, Läänemets went on.

"We have to be in solidarity, just as the Western world has, with Ukraine and the Ukrainians. Paying taxes for your country and people is not a punishment, it is a privilege, and a truly national and patriotic act," Läänemets went on.

According to Läänemets, there are currently two wars going on - one of them in Ukraine, and the other in Estonia. "The war [in Estonia] is being waged against brutal price increases, the collapse of companies and the impoverishment of families. We must not lose either war," Läänemets said. 

The "invisible hand", which he said has been worshiped in Estonia for decades, cannot guarantee the sustainability of the Estonian nation state, the environment, or local entrepreneurship, the Sde leader continued. 

"The free market and the lack of regulation that the Reform Party has talked about have only amplified the problems, not resolved them. As a result, there are far more losers than winners."

The party is in the middle of a two-day seminar at Kuremaa Manor, Jõgeva County this weekend (see gallery above), focusing on the upcoming Riigikogu elections and the current political situation.

The meeting involves all SDE ministers: Piret Hartman (Culture), Riina Sikkut (Public Administration), Madis Kallas (Environment) and Peep Peterson (Health and Labor), plus Läänemets himself, along with over 100 SDE members, MPs and local councilors from all over the country.

The move has set the party in stark contrast to Reform, at least in the latter's traditional stance.

In terms of concrete figures, Läänemets put a "fair wage" at €1,200 per month minimum, given the soaring inflation experienced this year, the highest in the eurozone, while monthly wages, particularly at the lower end of the scale, should rise by at least €400 per month.
Education and regional policy were also on the table on Saturday, the SDE leader told ERR.

The general election takes place on March 5, 2023.


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Editor: Andrew Whyte, Aleksander Krjukov

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