Neivelt: Income tax reform's direction right, but cap needed at 40 percent
The direction taken with the income tax reform is right and the income tax rate for high income earners should be raised further, but not above 40 percent, former top banker Indrek Neivelt said at an income tax conference of the Center Party on Friday.
"The limit for the income tax for high income earners is at one-third or 40 percent," Neivelt said.
"The direction is right, the basic exemption has to be raised. We've been taxing income to date with which it is not possible to sustain oneself. You mustn't tax income which is not sufficient to sustain a person with income tax," he said.
"I would have shifted taxation more towards owners of real estate and highly paid individuals," the former Hansabank CEO said.
According to Neivelt, the existing simple and uniform tax system of Estonia is not sustainable and we should follow the example of Scandinavia and Germany, who have more experience with taxes. "We cannot keep the system simple, life is getting more complex all the time and you can't stick to a simple system," he added.
Neivelt also said that the state should not be supporting entrepreneurs at all and that the money used for that purpose so far should be spent to support poorer people and do other necessary things.
"Entrepreneurs should be getting no state support at all, entrepreneurs are people who must cope on their own. If they don't, you do not have to do it either. The state must help those who cannot cope by themselves, not entrepreneurs," he said.
Editor: Dario Cavegn