Expert: New coalition agreement will make tax policy more predictable

Estonia's new coalition agreement is more systematic than the previous one and will make tax and budget policy more predictable, says Tallinn University (TLÜ) political scientist Tõnis Saarts.
According to Saarts, the Reform Party remains firmly in control in the new ruling coalition, despite the fact that the Social Democrats (SDE) have gotten stronger in the Riigikogu after several members joined the party and will likewise command more ministerial porfolios in the new government.
Considering the state's financial situation, he noted that the new coalition didn't have many options when drawing up the new coalition agreement.
"I think this agreement involves a lot of forced choices," the political scientist said. "Given the state of public finances, it would also be very irresponsible for politicians to ignore it completely. They'd rather reduce taxes than raise them, and increase borrowing instead."
He acknowledged that there weren't many options here.
"In the current security and economic situation, it's clear that the tax policy and taxation levels Estonia has had are outdated," Saarts said. "Society's demands are a bit different, geopolitical challenges are a bit different, and whoever is in this government and the next government will have to adapt to them."
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Editor: Marko Tooming, Aili Vahtla