Reinsalu: Car tax has got to go

Despite the coalition deal's promise of a discount for families with kids, Isamaa chair Urmas Reinsalu remains firm that the motor vehicle tax must be abolished.

"The coalition itself admits the car tax is a failure, and knows it will be abolished in 2027, and now it's staging a tactical retreat, since society is justifiably angry and upset," he said.

Reinsalu pointed out that the deal as a whole doesn't reflect clear financial calculations about what will be done and where the money for it will come from, criticizing, among other things, vague promises regarding the salaries of teachers, cultural workers and emergency personnel.

He also called the Reform Party declaring a long-term budget deficit its goal "quite telling," emphasizing that when the economy weakens, "taxes must be cut and government spending reduced," but none of this is in the agreement.

Reinsalu warned that instead, the coalition plans to cancel child-related tax exemptions, cut parental benefits, and strip stay-at-home mothers of their health insurance coverage, "but there's not a single word about this in the deal."

The Isamaa chair noted that in the energy sector, hopes to halt offshore wind farm projects have vanished, while the section of the agreement regarding healthcare provides "question marks," not clear solutions.

Kõlvart: Government offering cosmetic fixes

While he acknowledged the effort to ease the burden, Center Party chair Mihhail Kõlvart agreed that the car tax needs to be abolished.

"It's clear people's livelihoods have worsened rapidly in recent years thanks to decisions already made by the new coalition lately," he said. "And now they're trying to improve the overall situation with cosmetic fixes — especially for social groups currently in the most critical condition, meaning pensioners, young families and families with children."

He criticized the coalition's tax clawback, pointing out that abolishing the so-called tax hump won't actually improve people's livelihoods, but will burden the budget by about half a billion euros — compensated for by taking money back from the people through the car tax or increased VAT and income taxes.

Playing this kind of "tax trick" on taxpayers is "definitely not a solution," he added.

Regarding economic growth, the Center chair warned that without solving the issue of affordable electricity and reforming the tax system so "those who can pay bear the burden, not pensioners and families with kids," Estonia won't see economic growth anytime soon.

Helme: They're pulling the wool over our eyes

EKRE - Conservative People's Party of Estonia chair Mart Helme called the Reform-Eesti 200 coalition deal a charade, and accused the ruling parties of corruption.

"The first thing I have to say is that what's been done under the name of coalition negotiations has been one big pulling of the wool over the public's eyes," he said. "It's been a major manipulation and a charade."

Helme stressed that what the Reform Party and Eesti 200 put in writing and what rhetoric they use don't matter compared to their actions or the real situation in Estonia.

"We clearly see that the government is failing to govern, and we also clearly see that corruption has grown worse than ever before," he commented, referring to corruption in connection with wind energy projects, Rail Baltica and even defense investments.

The EKRE chair predicted that upcoming state budget talks and this fall's local elections will start affecting politics this fall, and could ultimately spell the end of this government.

Still, he added that even a new government wouldn't lead to a change in political direction.

Läänemets: No plan for life beyond defense spending

Social Democratic Party (SDE) chair Lauri Läänemets said the government has taken two months to do "two days' worth of work," pointing out that most of the agreement just repeats what's already in ministry action plans.

"What's worrying is that there are no answers to the key questions — how healthcare, higher education or road construction will be funded," he said. "Not a word. And these issues are just a couple of years away."

Läänemets criticized the government's patchwork defense spending over the past three years, which has come "at the expense of education, culture, healthcare and people's livelihoods," despite knowing now that the current security situation is no longer temporary.

"The government isn't offering Estonia a new model for moving forward in a way that would allow the state to function normally in other sectors alongside major national defense spending," he said.

He described the deal as a "let's try to make it until the next elections" approach, but one lacking solutions for how the state is supposed to function and other sectors survive that kind of defense spending for the next ten years.

Two months in the making

The ruling Reform Party and Eesti 200 released a new coalition agreement on Saturday, which includes cutting the wait time for rejoining the second pension pillar, offering car tax relief for families with children, completing key defense and tax reforms and continuing the development of four-lane highways to Pärnu and Tartu.

The core of the coalition agreement, along with reform plans, was negotiated over the course of two months.

Estonia's ruling coalition originally included the Social Democratic Party (SDE), but after SDE was ousted in March, Reform and Eesti 200 formed a two-party government.

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