Politicians do not plan to introduce a car tax in Estonia

Parked cars.
Parked cars. Source: ERR

Politicians do not intend to introduce a vehicle tax to limit the age of cars driven and imported to Estonia and no in-depth discussion about the issue is planned, ERR reported on Tuesday.

There are approximately 750,000 cars in Estonia with an average age of 16 years. In comparison, the age of the average car in Finland, Sweden, Germany, and the UK is between eight and 10 years. In Latvia and Lithuania, the average is over 16 years.

Estonia wants to achieve climate neutrality by 2050, but with these older vehicles which emit more emissions, it will be harder to meet the obligations of the CO2 Reduction and Renewable Energy Directive.

While limiting the use of older diesel cars in Europe is spreading, there is an increasing influx of older and diesel-powered cars in Eastern Europe. In Estonia three-quarters of all cars imported are diesel-powered and older.

Arno Sillat, head of the Federation of Car Sales and Service Companies, said in an interview with ERR (link in Estonian) there had been an increase in older cars being imported to the country and that a general car tax would not stop this. However, controls on imported cars should be tightened, he said.

In response to this, ERR asked politicians if they foresaw the need for a car tax in the coming years.

Coalition parties did not see the need to introduce a car tax. Erki Savisaar, a Centre Party chairman on the Riigikogu's Environment Committee, said a CO2 tax would not help, but believed people should be encouraged to use public transport instead.

Aivar Kokk, chairman of the Finance Committee of the Riigikogu and a member of Isamaa, said that the party does not see the need for a car tax at the moment as the market is moving towards alternative and environmentally friendly solutions. Secondly, the introduction of a car tax would be a punishment for people whose only means of transport is a car.

Both Kokk and Savisaar said the government's plans do not include introducing a car tax in Estonia in the coming years. 

Opposition parties also had similar thoughts. The Reform Party does not support the idea of ​​a car tax as it increases the tax burden and increases government spending. However, the Social Democratic Party believe that analyze needs to be undertaken, but the party has no set position on the issue.

Joonas Laks, a member of the board of the Estonian Greens party said looking at car tax as a measure to reduce CO2 emissions does not make sense.

"Every new car that is produced, even during its production, is emitting carbon and it is said that as much as half of the carbon emissions have already been emitted by the time it leaves the factory," said Laks.

Instead, the Greens believe public transport should be encouraged and money from fuel taxes could be used to create environmentally friendly traffic solutions instead.


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Editor: Helen Wright

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