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Food Industry Association: Producers have no idea what will be taxed next

Chairwoman of the Estonian Food Industry Association, Sirje Potisepp.
Chairwoman of the Estonian Food Industry Association, Sirje Potisepp. Source: (Postimees/Scanpix)

In the opinion of Sirje Potisepp, chairwoman of the Estonian Food Industry Association, the tax environment hasn't been “normal” for a while. In the current situation, producers couldn't even imagine any more what the government was going to tax next, Potisepp said.

The Ministry of Finance announced its plan on Tuesday to include certain dairy products in the planned tax on sugary drinks, if only to level the playing field among producers, as the state would later ask the European Commission to allow them to exclude dairy from the new tax.

Potisepp told ERR on Wednesday that though she had been present at the according meeting of the Riigikogu's Financial Affairs Committee, she had not been told about this plan, or at least did not hear it explained to a sufficient extent.

“We are astonished by this approach of the ministry, where it isn't understandable what they want at all, and which products they actually want to tax. This doesn't need to be this way, and that's why we've made the very clear proposal to stop work on this bill,” Potisepp said, adding that the bill should be thrown out, and work on the issue start over.

The government had rejected its duty to carry out thorough analyses before changing the bill which would make it possible to actually determine to what extent the tax changes would influence people's consumption behavior, and how it would affect the Estonian economy and industry, Potisepp said. Instead, things had been rushed, and there hadn't been any time at all for thorough analysis.

The current bill didn't correspond to European Union law, and even its authors had admitted that there were issues concerning the government's preference of some producers over others. All of this needed to be discussed and agreed on with the European Commission, Potisepp said.

At this point, the Association wasn't ready to make any more proposals, but would remain of the opinion that no new taxes on any food products should be introduced at all, she added.

Editor: Dario Cavegn

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