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Estonia: The Bill enabling the unemployed to do gigs passed the first reading in the Riigikogu

NordenBladet — The Bill that will allow people to work temporarily while they are registered as unemployed passed the first reading in the Riigikogu today.

The Bill on Amendments to the Labour Market Services and Benefits Act and the Unemployment Insurance Act (206 SE), initiated by the Government, will increase flexibility in the unemployment insurance benefit system, and will provide people greater social protection in the event of unemployment.

According to the Bill, in the future, a person who has been registered as unemployed can work temporarily for up to five days a month, but in 12 months within two years as a maximum, and receive remuneration for that, which can be monthly up to 40 per cent of the minimum monthly wage in the previous year, which is 216 euro this year. The current law does not provide for such a possibility, and the registration as unemployed and the payment of unemployment benefits are terminated when the person takes up employment.

The Bill will specify the calculation of the unemployment insurance benefit in a situation where the insured person has been working in Estonia before he or she loses his or her job and, before that, outside Estonia in another contracting state of the European Economic Area or in the Swiss Confederation. The remuneration benefits will also increase: in the first hundred days of unemployment, the unemployment insurance benefit will be 60 per cent, instead of the current 50 per cent, of previous income, and the unemployment allowance will be 50 per cent, instead of the current 35 per cent, of the minimum wage in the previous year.

To facilitate seasonal employment of the unemployed, the Bill will amend the conditions for receiving the unemployment insurance benefit so that, if a person loses his or her job again after the end of seasonal work, the payment of the benefit will continue if the benefit has not been not paid for all days of the previous period of the payment of the benefit and no more than 12 months have passed since the person took up employment.

The Bill provides for the entry into force of the Act on 1 September 2020 when the provisions on temporary employment will enter into force. The increase in the replaced rate of the unemployment allowance and the unemployment insurance benefit will enter into force on 1 August 2020. The changes to the replaced rates will thus concern the benefits calculated from 1 August, and they will have no retroactive effect.

Lauri Läänemets took the floor on behalf of the Social Democratic Party Faction in the debate.

Two more Bills passed the first reading

The Bill on Amendments to the Fiscal Marking of Liquid Fuel Act and Amendments to the Taxation Act in connection with that (203 SE), initiated by the Government, will reduce the expenses of oil shale mining undertakings, allowing them to temporarily use diesel fuel for specific purposes.

Under the Bill, oil shale mining undertakings will be permitted to temporarily use diesel fuel for specific purposes on the territories of oil shale mines and open cast mines, in open cast mine technology and equipment, including in mining machinery, and the machinery used for transporting oil shale and ash. It will not be permitted to use fuel marked with a fiscal marker in transport on public roads. It will be possible to use diesel fuel marked with a fiscal marker in the period from 1 July 2020 to 30 June 2022.

Under the current Act, in the period from 1 May 2020 to 30 April 2022, the rate of excise duty on diesel fuel is 372 euro, and the rate of excise duty on diesel fuel marked with a fiscal marker is 100 euro per 1000 litres. Starting from 1 May 2022, the rate of excise duty on diesel fuel will be 493 euro, and the rate of excise duty on diesel fuel marked with a fiscal marker will be 133 euro per 1000 litres.

During the debate, Maris Lauri (Reform Party), Jevgeni Ossinovski (Social Democratic Party), Aivar Kokk (Isamaa) and Riho Breivel (Estonian Conservative People’s Party) took the floor.

The Reform Party Faction moved to reject the Bill at the first reading. 26 members of the Riigikogu voted in favour of the motion, 48 were against, and there were two abstentions. Thus, the motion was not supported and the first reading was concluded.

The Bill on Amendments to the Environmental Charges Act (204 SE), initiated by the Government, provides for a reduction in the expenses of oil shale mining enterprises, allowing them to temporarily pay a lower pollution charge upon dumping oil shale fly ash and oil shale bottom ash.

The Bill will enable oil shale mining enterprises to temporarily pay 1.31 euro per ton upon dumping oil shale fly ash and oil shale bottom ash from 1 January 2020 to 31 December 2020. With this, the charge for dumping ash will be reduced to the level of the charge for dumping oil shale residue. At present, the charge for dumping oil shale fly ash and oil shale bottom ash is 2.98 euro per ton. The reduction of the dumping charge will affect in particular three enterprises to whom oil shale extraction permit has been issued: Enefit Mines Ltd, VKG Mines Ltd and Kiviõli Chemistry Industry LLC.

During the debate, Maris Lauri took the floor on behalf of the Reform Party Faction and moved to reject the Bill at the first reading. 16 members of the Riigikogu voted in favour of the motion, 44 were against, and there was one abstention. The motion was not supported and the first reading was concluded.

A Bill was dropped from the proceedings of the Riigikogu

The Bill on Amendments to the Preschool Child Care Institutions Act (183 SE), initiated by the Social Democratic Party Faction, was intended to eliminate parents’ obligation to pay the nursery fee, and the relevant cost would have remained to be borne by the state. The state would have compensated for the loss of profit to local governments. The aim of the Bill was to ensure a free nursery place to every child.

During the debate, Indrek Saar (Social Democratic Party) and Aadu Must (Centre Party) took the floor.

The lead committee moved to reject the Bill at the first reading. 52 members of the Riigikogu voted in favour of the motion and 22 voted against. Thus the Bill was rejected and it was dropped from the proceedings.

The Minister of Finance Martin Helme replied to the interpellation submitted by members of the Riigikogu on 22 April.

Members of the Riigikogu Jaak Juske, Heljo Pikhof, Lauri Läänemets, Ivari Padar, Helmen Kütt, Indrek Saar, Jevgeni Ossinovski, Katri Raik and Raimond Kaljulaid asked the minister about the budget and fiscal policy measures targeted at micro and small enterprises. The interpellators wished to know what specific measures targeted at sole proprietors would be funded from the first supplementary budget for 2020, and what support measures for sole proprietors the Government was planning to consider in connection with the potential second supplementary budget. They also asked if the minister considered it necessary to establish an unemployment insurance premium for all people who received remuneration, including sole proprietors, in order to prevent pressure on the state budget during the potential following economic crises.

The Minister of Finance said that sole proprietors were a very large target group, and when developing allowances for them it had to be asked whether to compare them to employees or undertakings. “Do we wish to support the continuation of enterprise, or do we wish to direct people to salaried job or entrepreneurship in another field? This will also determine the measures,” he said.

In the words of the minister, the payment of the advance payment of social tax for the first quarter by the state was non-repayable financial support targeted specifically at sole proprietors. The maximum amount of an allowance was 534.5 euro. Sole proprietors whose spouses participated in the activities of their businesses had also been exempted from payment of social tax for three months, and the rules for the taxation of their revenue from forest had been mitigated.

The Minister noted that, in addition, an additional tax exemption would be applied for the income tax return of 2020 which would be due by 30 April 2021. According to his words, sole proprietors could also apply for support measures that are available to all undertakings through the Enterprise Estonia, and for the measure for compensation for damages for tourism businesses. “Besides the abovementioned support, there will also be activity-specific allowances. For example, the Ministry of Culture has planned allowances for undertakings operating within its area, among others for creative persons who can also operate as sole proprietors,” Helme added.

In response to the question concerning a second supplementary budget, the Minister of Finance said that the Government had not discussed the initiation of one this year.

In the minister’s words, the Government had reached the decision that the range of the persons covered by unemployment insurance could be extended on a voluntary basis. He noted that the more specific conditions were under development. At the same time, in Helme’s opinion, the extension of the unemployment insurance premium to sole proprietors is not in fact a topical problem. “If a total of 1875 sole proprietors have made an entry concerning the termination or suspension of their activities in the Commercial Register from March to May 2020, it is actually a very small part of the total number of sole proprietors,” he added.

The sitting ended at 7.48 p.m.


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