Ministry: Reform Party made costliest pre-election pledge
The costliest pre-election pledge issued by any party is Reform's income tax promise, which would cost state coffers almost €500 million, according to an analysis prepared by the Ministry of Finance.
ERR reports that this is followed by pledges from both the Conservative People's Party of Estonia (EKRE) and the Center Party to reduced VAT on food and medicine, which would cost an estimated €430 million.
The Ministry of Finance has analyzed the costs to the state budget of pledges from all the parties running at the March 5 Riigikogu elections, finding that the Reform Party's €700 per month income tax-free allowance to all will cost, as noted, an estimated half-a-billion euros.
Presenting the analysis results at a press conference, Risto Kaarna, lead analyst at the ministry's financial policy department, noted for comparison the current parental benefits scheme, which costs around €400 million per annum, and work incapacity benefits, which come to around €500 million a year.
The ministry listed the top 15 costliest manifesto pledges, as issued by the parties ahead of the March 5 Riigikogu election. All 15 would cost the state at least €150 million.
Of the remaining parties, Eesti 200, the Social Democrats (SDE) and the Center Party's income tax reform, whose cost will be slightly lower than the above, ERR reports.
Of old age pension pledges, EKRE's target of €1,200 per month within the next few years will cost over €300 million, the highest of any party.
SDE's pledge to raise the minimum wage, also to €1,200 per month, would cost over €250 million, as the policy would include a compensation mechanism from the state, to employers, at least in the e
Below the €250-million mark lie SDE and Eesti 200's plan to boost child allowances, Center's policy to boost higher education funding, and Parempoolsed's manifesto pledge of reducing labor taxes.
Other expensive pledges come in defense; EKRE, Eesti 200, SDE and Center all included plans which, while not fleshed out in detail, are based on the assumption of a rise of half of one percent of GDP.
Reform and Isamaa plans to reform the district heating network, Eesti 200's quick teacher wage hike, and Isamaa's home renovation support for larger families (three or more children) would also require digging deeply into the state's pockets, as would an EKRE policy relating to student loans and grants, and other Isamaa policies on income tax relating to dependent minors.
The top 15 costliest electoral pledges (see image above) are rounded off by the continuation of current electricity price support measures, pledges made by both SDE and Center.
Naturally the above policies would need to be implemented as stated, which could only happen with a party not only entering office, but getting its pledge(s) into any coalition agreement unchanged.
In evaluating the electoral pledges, the finance ministry took the current state budget strategy as its basis. While the top 15 policies would cost €150 million or more to implement, there were a large number of promises in the €50-€100-million range.
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Editor: Andrew Whyte