Chairman: SDE has three alternatives to raising salary tax
SDE chairman and Minister of the Interior Lauri Läänemets said the party has several different suggestions to the increase in salary tax proposed by Minister of Finance Jürgen Ligi (Reform) earlier this month.
Läänemets told ERR the party's leadership has thoroughly discussed the suggestion.
"We have three alternatives to offer. Certainly, the debate will not remain the one that is only proposed by the minister of finance, but we have three alternatives to come up with for exactly the same part of this tax base. We will discuss it and see. I'm not going to say what these things are, otherwise, the debate will be in the columns of this newspaper, but I'm sure it will be an interesting discussion," the minister said.
At the moment, little is known about Ligi's proposal. "And I cannot say when and how it will be presented," Läänemets said. "But at the moment, we are working on the basis that what is agreed in the coalition agreement must be done, and another principle is that we are, of course, open to discussing different ideas."
The chairman said he has also raised the issue with entrepreneurs. They are concerned the hike would stunt Estonian exports.
"This will make Estonia as a whole less prosperous, will slow down economic growth and will ultimately be very unfair between businesses. It favors companies that deal with finance, for example, and have few employees. It is a heavy burden for Estonian manufacturing and retail businesses," Läänemets said.
The minister said the main argument is not whether more or less money is received from the tax, but what effect it has on the economy.
The government will start next year's state budget negotiations this week. It hopes to approve the state budget and the state budget strategy (RES) by the end of September.
Earlier this month, Ligi told ERR he is considering introducing a new 2 percent taxation of all salaries of company employees instead of advance income tax on company profits.
This would be easier to collect and less burdensome for companies, he argued.
Prime Minister Kristen Michal (Reform) said the government will make the final decision.
--
Follow ERR News on Facebook and Twitter and never miss an update!
Editor: Alexander Kryukov, Helen Wright