A little while ago, I stepped into a shop at Balti jaam to buy lunch before heading to work. In front of me at the register was an elderly man who had placed a single pickle and a single mandarin — both wrapped in a plastic bag — on the conveyor belt. At the checkout, he was counting his coins. It turned out he didn't have enough money for both items.

At the same time, the government was deep in discussions about which taxes to raise and what to cut. I've been following these debates with growing concern, because in my view, while business and efficiency remain at the forefront, what's being lost is something far more important: the people of Estonia — especially those whose voices go unheard in society.

To better understand how the government's tax and austerity decisions affect people in more vulnerable social positions, we at the Office of the Gender Equality and Equal Treatment Commissioner commissioned a study from the think tank Praxis. We will publish the full analysis on June 10, alongside the commissioner's annual report.

The analysis revealed that the tax changes set to take effect in 2025-2026 will hit hardest those already in a difficult socioeconomic position. People with low incomes — who often belong to other risk groups as well — are especially vulnerable.

According to the calculations, income will decline and the relative poverty rate will increase most significantly among single parents and the elderly, who already face a very high risk of poverty. This effect is even more pronounced among women: the greatest impact from the tax changes will fall on older women living alone, whose monthly income will decrease by €24 (not including the car tax), and on households with single mothers, whose income will drop by €18 per month.

The Estonian state has an obligation to promote gender equality and equal treatment. These requirements, which foster social balance, are rooted in law and are essential to ensuring that our country remains sustainable, our society resilient and trust among people intact. But we are certainly not moving toward balance if we fail to help those already in weaker positions catch up.

Range of effects from tax changes relative

Estonia still has one of the highest gender pay gaps in Europe. Many women — especially single mothers and the elderly — live below the relative poverty line. For someone with a low income, losing €20-24 per month is not a marginal amount; it can be critical for covering the cost of food, medication or extracurricular activities for a child.

The results of the analysis show that while, overall, the combined impact of tax changes on income in Estonia is not very large (the average income change is just a few euros), the impact is unevenly distributed across different groups. The extent of the impact is relative: for someone with a low income and a high risk of poverty, even a €20 decrease in monthly income can make it significantly harder to get by.

Moreover, the effects of the tax changes are cumulative. Increases in income tax, value-added tax and excise duties, along with the introduction of a car tax, all add up and make life increasingly difficult for people in vulnerable situations. Eliminating the tax hump (Estonia's gradual basic exemption reduction scheme — ed.) and raising the tax-free minimum income may help ease the burden, but this primarily benefits those with middle and high incomes.

Just because a tax hike is applied uniformly doesn't mean its impact is equally manageable. When it comes to the car tax and the rise in fuel excise duties, it's clear that people in rural areas — especially those with low incomes and disabilities — are hit harder because they depend on their cars for daily tasks, including getting to medical appointments or taking their children to extracurricular activities.

One-time or universal benefits are no substitute for truly needs-based support. For instance, a one-off vehicle tax compensation payment was also given to people with disabilities who didn't even own a car. At the same time, many who do have a car and need it for daily life didn't receive adequate support.

Regional inequality deepens when municipalities differ in their ability to support those in need. For example, the housing costs used to calculate subsistence benefits, the level of support for extracurricular activities and access to or the cost of social transport vary from one local government to another. So we cannot talk about equal treatment regardless of place of residence.

Social trust in jeopardy

Budget cuts also significantly impact the organizations that support people in vulnerable situations on a daily basis — whether they work to prevent violence against women, represent people with disabilities or advocate for gender equality. When their work is hindered, individuals are left more alone.

The less a person feels they can get help when needed, the less trust they have in the state. This also affects their willingness to participate in the labor market, raise children, pursue education and engage in their community.

If some people already have to choose between affording a pickle or a mandarin, their situation will only grow more difficult in the future. From this, it can be concluded that the government's decisions have not taken everyone into account.

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