Wednesday's "Aktuaalne kaamera" spoke to all party leaders about the plans.

Michal, who will become Reform's chairman in the autumn, said the parties all agreed on a broad national defense tax. But the exact details are not yet clear.

"Both VAT and income tax will probably play a role. We will discuss what the exact ratio is. It also probably means looking at excise duties. So we are discussing that, and we will have to wait for about a month when the [coalition] negotiations wll have reached a stage where we can present this plan to the public in detail," he said.

Eesti 200 Chairman Margus Tsahkna said a lot of money needs to be raised: "But it has to be spread evenly between different groups so that people do not get hit too hard."

Both Tsahkna and SDE Chairman Lauri Läänemets said companies should also contribute to national defense.

"It should not be the case that the ordinary working person pays in full and then only 15 percent of companies contribute. Then it should also be the case that if all people contribute, then all companies contribute. I have heard entrepreneurs who have said that they think of it is a patriotic act," Läänemets told AK, likely referencing Bolt founder Martin Villig.

Tsahkna ruled out introducing a corporate tax on companies. "We're talking about, for example, the point at which dividend income is taxed, the point at which personal income is taxed, for example, whether it is before any exemptions on the basis of the most or whether any exemptions are taken into account. We must also bear in mind that group of society which today is in difficulty of subsistence."

Michal said the earliest a national defense tax could into force is mid-2025.

On Wednesday, Minister of Finance Mart Võrklaev (Reform) said the tax could be limited to five years. Michal said the need for such a tax will not disappear anytime soon.

"Let's just say that our neighbor is unlikely to become democratic any time soon. Initially, there have been such debates and public discussions that this could be a one-government cycle, or four to five years, and the next government can assess this security situation with the Defense Forces and the various stakeholders," he told AK.

The new tax is needed to fund additional defense investments, including €1.6 billion worth of ammunition.

Michal is expected to become prime minister at the start of August, replacing Kaja Kallas. A new coalition agreement is currently being discussed between the three parties, and official negotiations will start when Kallas steps down in mid-July.

Last month, Lithuania's parliament adopted a package of taxes, aimed at increasing defense spending to 3 percent of GDP. It included raising the rates of corporate tax and excise duties on alcohol, cigarettes, and fuel.

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