“Individually and with our NATO Allies we must continue strengthening collective defence and deterrence and border security in NATO’s eastern flank bordering Russia and Belarus. We look forward to concrete action on this goal at the forthcoming NATO Summit in Vilnius,” the Speakers emphasised in the Joint Declaration.
In their opinion, our focus must stay on assisting Ukraine. “Together with our Allies and partners we will continue providing all the necessary support to Ukraine, for as long as necessary, until Ukraine’s victory. We call on the whole international community to increase the support to Ukraine in its ongoing struggle for freedom and territorial integrity,” the Speakers noted, and called on called on establishing of a special international tribunal under the auspices of the UN General Assembly to prosecute the crime of aggression committed by the leadership of the Russian Federation.
The Speakers of the Baltic Parliaments expressed their conviction that ultimately Ukraine’s security in the long-run can be best guaranteed by collective defence of NATO, and called on NATO leaders to start a substantive process of inviting Ukraine to join NATO at the Summit in Vilnius.
The Speakers underlined that the Parliaments of the Baltic States had long labelled the Wagner mercenary group as terrorist organization for the atrocities committed by its members on the territory of Ukraine and against the Ukrainian population. “We reiterate our call on the European Union (EU) to include the Wagner mercenary group in the list of persons, groups and entities involved in terrorist acts (EU terrorist list) not least for the violence and instability the group spreads on the African continent and elsewhere,” they said.
According to the Speakers, the emergence of the Wagner mercenary group in Belarus could make the security situation on the eastern borders of NATO and the EU even more precarious. “We reiterate our condemnation of Lukashenko’s regime in Belarus for supporting Russia’s war against Ukraine. The harbouring of the terrorist organization Wagner group by Belarus is unacceptable and we call for further strengthening sanctions against Belarus,” the Speakers added.
The Joint Declaration was signed by President of the Riigikogu (Parliament) of Estonia Lauri Hussar, Speaker of the Saeima (Parliament) of Latvia Edvards Smiltēns and Speaker of the Seimas (Parliament) of Lithuania Viktorija Čmilytė-Nielsen.
According to Deputy Chair of the European Union Affairs Committee Maria Jufereva-Skuratovski, the Committee supports digitalisation of passports and identity cards to facilitate travelling. “I believe that digital travel documents will significantly accelerate the work of the border crossing points, shorten the waiting time of travellers and improve the safety of border control,” she said. “When developing digital documents, special attention has to be paid to their security, the prevention of possible misuse and data protection rules. A digital document must be at least as secure as a physical travel document.”
It was pointed out at the sitting that with a digital travel document, it would be possible to go on board after validation of identity through facial biometrics, and that the digital document also had to be in a mobile app. At first, it will probably be necessary to carry a physical document in addition to a digital travel document, but in the longer term, it will not be necessary any more to carry a passport or other identity document when travelling in the European Union. The possibility of using a physical document must be retained for those whose facial biometrics cannot be read or who do not use a smartphone.
The positions approved by the European Union Affairs Committee set out that the EU-level solution should support global interoperability of digital travel documents and be based on common International Civil Aviation Organization (ICAO) standards. The digital travel documents should also be compatible with the European digital identity wallet that is being developed.
According to Estonia’s position, EU countries should implement digital travel documents at the same time or at least recognise the solution to be created, and a sufficient transition period has to be ensured. As a first step, Estonia supports a solution where the data of the digital document are linked to the physical document. Estonia’s positions also underline that it should be possible to create and use a digital travel document to return to the country of citizenship if the physical document has been stolen or lost in a foreign country.
The European Union Affairs Committee decided to support the positions submitted by the Government. It was noted at the sitting of the Committee that the public consultation would be followed by an impact assessment, and after that, it is planned to present a proposal for a Regulation.
At the sitting of the European Union Affairs Committee, Adviser at the Border Guard and Migration Policy Department of the Ministry of the Interior Elen Kraavik gave an overview of the positions of the Government and replied to the questions of the members of the Committee.
The PACE adopted a Resolution in which it calls on the International Olympic Committee (IOC) to prohibit the participation of Russian and Belarusian athletes in the Paris Olympic and Paralympic Games and all other major sporting events as long as Russia’s war of aggression continues.
In her speech before the Assembly, Head of the Estonian delegation to PACE Liisa Pakosta demanded full support for Ukrainian people and banning of the Russian and Belarusian athletes and officials from the Olympic Games. She urged the national IOC representatives, the sports public and sports federations to express their opposition to the IOC’s proposal to allow the athletes of the aggressor state to participate in the upcoming Olympic Games.
“The Ukrainian fight for freedom is our fight. The murdered Ukrainian children are our children. This should not be forgotten or overlooked, and our response to the Russian war of aggression must also be in force at the Paris Olympic Games,” Pakosta said.
She added that Russia continued to use sport for propaganda purposes, and pointed out that many Russian and Belarusian athletes had publicly expressed their support for the war. She reminded her colleagues that just a few days before President of the Russian Wrestling Federation, Mr Mikhail Mamiashvili, had expressed his readiness to drive the Russian team to the Paris Olympics on tanks. “We have to tell him, “You are not welcome; please stay home with your tanks”,” she said. “Silence and neutrality about the issue of the participation of the Russian and Belarusian athletes is the same as spreading Russia’s hostile propaganda and means supporting of Putin,” the Head of the Estonian delegation added.
Besides Liisa Pakosta, members of the Estonian delegation Aleksei Jevgrafov and Eerik-Niiles Kross also attended the PACE session.
PACE is the oldest international parliamentary assembly in Europe that held its opening session on 10 August 1949. This year, Estonia celebrates the 30th anniversary of its membership in the PACE. Estonia became a member of the Council of Europe on 14 May 1993.
The task of the Council of Europe is to protect the fundamental values of its member states – human rights, the principle of the rule of law, and democracy.
55 members of the Riigikogu voted in favour of and 34 voted against passing the Act on Amendments to the Family Law Act and Amendments to Other Associated Acts (207 SE), initiated by the Government.
In addition to marriage, the possibility of concluding a cohabitation contract will remain, and according to the Act, registered partners will be able to make a simplified transition to marriage.
The Act will specify the regulation on filiation in the Family Law Act in connection with same-sex couples’ right to adopt. Same-sex spouses will get the right to adopt together through marriage equality. A spouse of the same sex will be able to adopt their spouse’s child with the consent of the biological parent of the child. The Act sets out the principle that a child may not have more than two parents. The principle that in particular the biological parents have the rights and obligations relating to the child will be maintained. The female spouse of the mother will have the relationship of filiation with the child when she grants her consent to the artificial insemination of the mother. When making amendments to the Bill before the second reading, the Government took into account the proposals of the Estonian Centre Party Parliamentary Group in order to set out more clearly in all Acts the principle that the second parent next to the mother is still first and foremost the father.
The Act will adopt the amendments enabling to realise to the full extent in practice the rights and obligations arising from the Registered Partnership Act adopted in 2014. The rights and obligations arising directly from registered partnership contract will not change. It will be possible for a registered partner to adopt only their registered partner’s child.
The Bill passed the first reading on 22 May, and 711 motions to amend it had been submitted by the deadline. On 15 June, the Government had decided to declare the passing of the Bill a matter of confidence before the second reading and thereby also taken over the duties of the lead committee.
The sitting of the Riigikogu will continue according to the agenda with the second and third readings of Bills. The extraordinary session will continue until all items on the agenda have been deliberated.
34 members of the Riigikogu supported the vote of no confidence in Kallas and 57 voted against it. At least 51 votes would have been needed to express no confidence in the Prime Minister and consequently in the whole Government.
Tanel Kiik, who represented the initiators of the motion of no confidence, said that, in the opinion of the members of the Riigikogu belonging to the opposition, the Government coalition of the Reform Party, Estonia 200 and the Social Democratic Party had begun to implement decisions that were short-sighted and harmful to families.
“The Government is steering the country in a completely wrong direction and is deepening the population crisis, economic crisis and trust crisis with its activities,” he said, and referred to the extraordinary session that had started the day before and ended today. In his opinion, decisions worsening the livelihood and welfare of Estonian people and families had been adopted one after the other at the session. In Kiik’s words, the Government is pushing through a policy for which they have received no mandate in the elections and the long-term negative impacts of which have not been assessed.
“Therefore 40 members of the Riigikogu from the Estonian Conservative People’s Party Group, the Estonian Centre Party Group and Isamaa Parliamentary Group have tabled a motion of no confidence in the Prime Minister Kaja Kallas because of lying and a deceitful policy, disrespectful language, and suppression of the Parliament,” Kiik said.
The Prime Minister Kaja Kallas thanked the members of the Riigikogu for discussing the Government’s policy as well as for their tenacity. She pointed out that there was a large deficit in the state budget and her party had promised to put public finances in order in its election programme. “A budget in a sustained deficit is not sustainable and leaving debts to your children is not sustainable,” she emphasised. The Prime Minister pointed out that decisions relating to taxes were not popular, but they could not be deferred.
When speaking of the cuts in family allowances, Kallas said that the allowances remained very generous and larger than the year before. “If people were able to manage in 2022, then now that the allowance has increased, they will be sure to manage, especially in the situation where inflation is going down and will be around 9% this year and where the purchasing power of the people is really increasing,” she said.
When speaking of the gender-neutral marriage, the Prime Minister said that it had not been her promise before the elections but, when forming the coalition, they had listened to their partners’ arguments and had found that it was reasonable to resolve this issue definitively so that there would be no need to fight any longer and everyone would have equal rights.
Kallas noted that, according to the Constitution of the Republic of Estonia, the Riigikogu adopted decisions by a majority of votes in favour. “This means that you must have a majority. This means that, in democracy, the majority decides,” Kallas stated. The Prime Minister underlined that the Government would declare no Bill to be a matter of confidence if the opposition did not obstruct Bills.
During the debate, Andrei Korobeinik took the floor as the representative of the Estonian Centre Party Group, Urmas Reinsalu as the representative of Isamaa Parliamentary Group and Henn Põlluaas as the representative of the Estonian Conservative People’s Party Group and Erkki Keldo as the representative of the Reform Party Group.
The Act on Amendments to the Alcohol, Tobacco, Fuel and Electricity Excise Duty Act and the Act on Amendments to the Alcohol, Tobacco, Fuel and Electricity Excise Duty Act and Other Acts (145 SE), initiated by the Government, raises the excise duty rates on alcohol and tobacco products in order to increase excise revenue and to influence the accessibility of alcohol and tobacco products.
The alcohol excise duty, which was last raised in 2018, will rise by five per cent per year in 2024–2026. The excise duty on cigarettes and smoking tobacco, which has been raised by five per cent per year in recent years, will rise to the same extent in 2024–2026. The excise duty on tobacco liquids will also increase by five per cent per year over the next three years, and the minimum amount of excise duty paid will grow to the same extent in the case of cigars and cigarillos.
In the case of cigars and cigarillos, the Acts establishes the accuracy intervals of the maximum retail price in order to reduce the range of prices and thereby the workload of businesses and tax authorities. Before the second reading, the Government had introduced an amendment according to which the maximum retail price of cigars and cigarillos would be announced to an accuracy of 10 cents, instead of 50 cents as planned earlier, if their price is below or equal to EUR 10.
In addition, with a view to supporting the competitiveness of Estonian agricultural producers, the rise in the excise duties on diesel fuel for specific purposes planned for 2024–2027 will be cancelled. This means that the rate of excise duty on diesel fuel for specific purposes will remain at EUR 21 per 1,000 litres.
The Bill passed the second reading on 17 May, and 230 motions to amend it had been submitted by the deadline. On 8 June, the Government decided to declare the passing of the Bill a matter of confidence before the second reading and thereby also take over the duties of the lead committee. Motions to amend a Bill that has been declared to be a matter of confidence in the Government are not put to a vote.
The Riigikogu continued the debate which had been interrupted on Thursday, with Jüri Ratas and Maria Jufereva-Skuratovski (Estonian Centre Party Parliamentary Group), Rene Kokk, Andres Metsoja, Aivar Kokk, and Tõnis Lukas (Isamaa Parliamentary Group), and Leo Kunnas and Arvo Aller (Estonian Conservative People’s Party Parliamentary Group) taking the floor.
57 members of the Riigikogu voted in favour of passing the Act and 35 voted against.
The on Amendments to the Value Added Tax Act (147 SE), initiated by the Government, will increase the VAT rate from 20 to 22 per cent as of 1 January 2024.
While at first the Government intended to repeal the current nine per cent reduced rate for accommodation from 2025, an amendment made before the second reading increased the VAT rate less than originally planned, i.e. to 13 % instead of 22%. At the same time, the VAT rate on press publications will increase, reaching nine percent instead of five in 2025.
According to the explanatory memorandum, the purpose of the amendments is to move towards a balanced state budget by increasing the receipt of state revenue. Another purpose is to make the tax system more efficient by reducing VAT derogations.
The Bill initiated by the Government passed the first reading on 17 May, and 240 motions to amend it had been submitted by the deadline. On 8 June, the Government had decided to declare the passing of the Bill a matter of confidence before the second reading and thereby also take over the duties of the lead committee. Motions to amend a Bill that has been declared to be a matter of confidence in the Government are not put to a vote.
During the debate, Siim Pohlak, Kert Kingo, Helle-Moonika Helme, Rene Kokk, Kalle Grünthal, Evelin Poolamets, Alar Laneman, Henn Põlluaas, Arvo Aller, Jaak Valge, Varro Vooglaid, Mart Helme, Leo Kunnas, Ants Frosch, and Anti Poolamets (Estonian Conservative People’s Party Parliamentary Group), Aleksandr Tšaplõgin, Jaanus Karilaid, Andre Hanimägi, Jaak Aab, Tanel Kiik, Vadim Belobrovtsev and Maria Jufereva-Skuratovski (Estonian Centre Party Parliamentary Group), Aivar Kokk, Mart Maastik, Priit Sibul, Urmas Reinsalu, Riina Solman, Helir-Valdor Seeder, Andres Metsoja, and Tõnis Lukas (Isamaa Parliamentary Group), and Jürgen Ligi (Estonian Reform Party Parliamentary Group) took the floor.
59 members of the Riigikogu voted in favour of passing the Act and 35 voted against.
The Act on Amendments to the Income Tax Act and the Military Service Act (148 SE), initiated by the government, eliminates several tax advantages, raises the income tax rate, and replaces the regressive income tax exemption with a single income tax allowance.
From 2024, the Act eliminates the increased basic exemption for natural persons who maintain a child and the increased basic exemption for a spouse, as well as their right to deduct housing loan interest from their taxable income.
The income tax rate for natural persons and companies will rise by two percentage points in 2025, i.e. from 20 to 22 per cent. At the same time, the 14-per cent reduced rate on the regularly distributed profit of companies will be eliminated and, in connection with this, the seven-per cent income tax withheld on the dividend paid to natural person will also be eliminated. While the original Bill intended to raise the advance payments of income tax for credit institutions from 14 % to 22 %, the Government made an amendment into the Bill before the second reading, according to which the advance payment rate would increase by less than planned, or to 18 %.
The Act will eliminate the regressive income tax exemption and establish a single income tax allowance of EUR 700 per month, that is, EUR 8,400 per year from 2025. Persons of old-age pension age whose tax allowance is equal to the average old age pension will constitute an exception.
In addition, the Act will correct the inaccuracies that the European Commission has identified with regard to the transposition of the Anti-Tax Avoidance Directive 2 in the Income Tax Act, in order to avoid infringement proceedings from the European Commission. Also, a technical amendment will be made to the Military Service Act by omitting the reference to the provision to be repealed in the Income Tax Act.
The Bill passed the first reading on 17 May and received 377 motions to amend it by the deadline. On 8 June, the Government had decided to declare the passing of the Bill a matter of confidence before the second reading and thereby also take over the duties of the lead committee. Motions to amend a Bill that has been declared to be a matter of confidence in the Government are not put to a vote.
During the debate, Henn Põlluaas, Siim Pohlak, Jaak Valge, Kalle Grünthal, Varro Vooglaid, Ants Frosch, Mart Helme, Helle-Moonika Helme, Kert Kingo, Rene Kokk, Anti Poolamets, Evelin Poolamets, Leo Kunnas, Arvo Aller, and Alar Laneman (Estonian Conservative People’s Party Parliamentary Group), Jüri Ratas, Lauri Laats, Vadim Belobrovtsev, Andre Hanimägi, Tanel Kiik, Jaak Aab, and Ester Karuse (Estonian Centre Party Parliamentary Group), and Priit Sibul, Mart Maastik, Helir-Valdor Seeder, Aivar Kokk, Riina Solman, Tõnis Lukas, Andres Metsoja, and Urmas Reinsalu (Isamaa Parliamentary Group) took the floor.
58 members of the Riigikogu voted in favour of passing the Act and 33 voted against.
The Bill on Amendments to the Gambling Tax Act (146 SE), initiated by the Government, raises the tax rates on various types of gambling games in order to increase the state budget revenue.
The current five per cent tax rate for remote gambling and toto will be raised in two stages: to six per cent in 2024 and to seven per cent in 2026. The tax rate for lottery and commercial lottery will rise from 18 to 22 per cent from 2024, the gambling tables tax rate will rise from 1278.23 to 1406, and the tax rate for gambling machines for games of skill will rise from EUR 31.95 to EUR 32. According to the explanatory memorandum, the rise in tax rates is planned in such a manner that it would not significantly affect market participants and would not entail fundamental reorganisation in the gambling industry.
The Bill passed the first reading on 17 May and received 203 motions to amend it by the deadline. On 8 June, the Government had decided to declare the passing of the Bill a matter of confidence before the second reading and thereby also take over the duties of the lead committee. Motions to amend a Bill that has been declared to be a matter of confidence in the Government are not put to a vote.
During the debate, Tõnis Lukas and Priit Sibul (Isamaa Parliamentary Group) and Helle-Moonika Helme, Leo Kunnas, Anti Poolamets, Evelin Poolamets, and Mart Helme (Estonian Conservative People’s Party Parliamentary Group) took the floor.
58 members of the Riigikogu voted in favour of passing the Act and 22 voted against.
The Act on Amendments to the Family Law Act and Amendments to Other Associated Acts (207 SE), initiated by the Government, provides that two adults will be allowed to contract marriage regardless of their gender as of 1 January 2024. The implementing acts of the Registered Partnership Act would also be passed with the Act.
In addition to marriage, the possibility of concluding a cohabitation contract will remain, and according to the Act, registered partners will be able to make a simplified transition to marriage.
The Act will specify the regulation on filiation in the Family Law Act in connection with same-sex couples’ right to adopt. Same-sex spouses will get the right to adopt together through marriage equality. A spouse of the same sex will be able to adopt their spouse’s child with the consent of the biological parent of the child. The Act sets out the principle that a child may not have more than two parents. The principle that in particular the biological parents have the rights and obligations relating to the child will be maintained. The female spouse of the mother will have the relationship of filiation with the child when she grants her consent to the artificial insemination of the mother. When making amendments to the Bill before the second reading, the Government took into account the proposals of the Estonian Centre Party Parliamentary Group in order to set out more clearly in all Acts the principle that the second parent next to the mother is still first and foremost the father.
The Act will adopt the amendments enabling to realise to the full extent in practice the rights and obligations arising from the Registered Partnership Act adopted in 2014. The rights and obligations arising directly from registered partnership contract will not change. It will be possible for a registered partner to adopt only their registered partner’s child.
The Bill passed the second reading on 22 May and 711 motions to amend it had been submitted by the deadline. On 15 June, the Government had decided to declare the passing of the Bill a matter of confidence before the second reading and thereby also take over the duties of the lead committee. Motions to amend a Bill that has been declared to be a matter of confidence in the Government are not put to a vote.
During the debate, Varro Vooglaid, Helle-Moonika Helme, Jaak Valge, Kalle Grünthal, Kert Kingo, Rene Kokk, Ants Frosch, Mart Helme, Anti Poolamets, Arvo Aller, Evelin Poolamets, Siim Pohlak, and Henn Põlluaas (Estonian Conservative People’s Party Parliamentary Group), Mart Maastik, Priit Sibul, Riina Solman, Urmas Reinsalu, Andres Metsoja, and Tõnis Lukas (Isamaa Parliamentary Group), Maria Jufereva-Skuratovski, Anastassia Kovalenko-Kõlvart, Jaanus Karilaid, and Aleksandr Tšaplõgin (Estonian Centre Party Parliamentary Group), and Eduard Odinets (Social Democratic Party Parliamentary Group) took the floor.
55 members of the Riigikogu voted in favour of passing the Act and 34 voted against.
The Act on Amendments to the Government of the Republic Act and Other Associated Acts (216 SE), initiated by the Government of the Republic, the Ministry of the Environment will be reorganised into the Ministry of Climate and the Ministry of Rural Affairs will be reorganised into the Ministry of Regional Affairs and Agriculture. The functions of the Ministry of Finance concerning regional affairs will be transferred to the Ministry of Regional Affairs, the functions of the Ministry of Social Affairs concerning employment and social affairs will be transferred to the Ministry of Economic Affairs and Information Technology, and the coordination of accessibility will be transferred to the Ministry of Regional Affairs and Agriculture.
The Bill passed the first reading on 7 June and received 261 motions to amend it by the deadline. On 15 June, the Government had decided to declare the passing of the Bill a matter of confidence before the second reading and thereby also take over the duties of the lead committee. Motions to amend a Bill that has been declared to be a matter of confidence in the Government are not put to a vote.
During the debate, Tanel Kiik (Estonian Centre Party Parliamentary Group), Rene Kokk and Leo Kunnas (Estonian Conservative People’s Party Parliamentary Group) and Urmas Reinsalu (Isamaa Parliamentary Group) took the floor.
57 members of the Riigikogu voted in favour of passing the Act and 23 voted against.
The Bill on Amendments to the State Budget for 2023 Act (214 SE), initiated by the Government, contains two types of amendments. First, the proposals arising from the reorganisations in ministries, which are connected with the Act on Amendments to the Government of the Republic Act and Other Acts. According to it, as of 1 July 2023, the Ministry of the Environment will be reorganised into the Ministry of Climate and the Ministry of Rural Affairs will be reorganised into the Ministry of Regional Affairs and Agriculture. Amendments will also be made in the areas of government of ministries. Second, proposals to amend the budget have been received from the areas of government. They were submitted to the Ministry of Finance this April. Before the second reading, the Government introduced amendments into the Bill, prompted by the changing volumes of budgets in various fields of administration as well as the reorganisations in ministries.
The Bill passed the first reading on 5 June and received 304 motions to amend it by the deadline. On 15 June, the Government had decided to declare the passing of the Bill a matter of confidence before the second reading and thereby also take over the duties of the lead committee. Motions to amend a Bill that has been declared to be a matter of confidence in the Government are not put to a vote.
57 members of the Riigikogu voted in favour of passing the Act and 22 voted against.
The Act on Amendments to the Income Tax Act and the Act on Amendments to the Social Welfare Act and the Income Tax Act (215 SE), initiated by the Government, amends the principles for the allocation of income tax to local governments.
The Acts will increase the income tax allocated from the state pension of a resident natural person in 2024 from 1.88 per cent to 2.5 per cent. At the same time, the income tax allocated from other taxable income, except for the mandatory and supplementary funded pension and gains derived from the transfer of property, will be reduced from 12.06 per cent to 11.89 per cent. Income tax is received into the budget of the local government of the residence of the taxpayer.
During the debate, Andres Metsoja (Isamaa Parliamentary Group), Arvo Aller (Estonian Conservative People’s Party Parliamentary Group), Vadim Belobrovtsev (Estonian Centre Party Parliamentary Group), and Anti Allas (Social Democratic Party Parliamentary Group) took the floor.
58 members of the Riigikogu voted in favour of passing the Act and 26 voted against.
At the sitting, member of the Supreme Court Margit Vutt took the oath of office.
The sitting ended at 1.08 p.m. on Tuesday.
The next extraordinary session will start at 1.40 p.m. The agenda includes a motion of no confidence against the Prime Minister Kaja Kallas, initiated by 40 Members of the Riigikogu.
The video recording of the sitting will be available to watch later on the Riigikogu YouTube channel. (Please note that the recording will be uploaded with a delay.)
NordenBladet – In a late-night session, the Riigikogu, Estonia’s parliament, passed a law tied to a vote of confidence in the government, leading to significant tax reforms. The legislation received support from 58 members, while 33 opposed it.
Effective from 2024, the new law eliminates certain tax breaks for individuals, including additional tax-free income for child and spousal support, as well as the deduction of mortgage interest. In addition, starting in 2025, both individual and corporate income tax rates will rise by two percentage points, reaching 22 percent. This change will eliminate the preferential 14 percent tax rate on distributed corporate profits and the 7 percent withholding tax on dividends paid to individuals.
Originally, the draft legislation proposed increasing the advance payment rate for credit institutions from 14 percent to 22 percent. However, the government modified the document before the second reading, reducing the increase to 18 percent.
Furthermore, beginning in 2025, the law replaces the regressive tax-free income system with a flat annual tax-free income of 8,400 euros or 700 euros per month. Retirees will be exempt from this change, as their tax-free income will align with their average pension.
The initial reading of the measure took place on May 17, with 377 amendments submitted by the deadline. On June 8, the government decided to link a vote of confidence to the adoption of the measure before the second reading, thereby taking on the responsibilities of the lead committee. The proposed amendments to the government’s measure of confidence will not be subjected to a vote.
The Riigikogu’s extraordinary session will continue on Tuesday morning, involving the second and third readings of the bills, as well as several votes of confidence. The session will continue until all agenda items have been addressed.
NordenBladet – A cutting-edge testing facility has recently been launched in the Ülemiste City business area of Tallinn, offering an exceptional environment for the Baltic and Nordic regions to experiment with and assess the effectiveness of emerging technologies. This state-of-the-art facility is inviting both local and international companies to put their new solutions to the test or validate their services within a realistic urban setting.
“The purpose of Ülemiste City that has been developed into a smart business area from scratch within two decades is to become a testing platform for new green urban solutions. As a compact business environment, we can offer testers access to our infrastructure, a community of 16 000 members, different support services and our know-how in development,” said the Chief Innovation Officer of Ülemiste City, Ursel Velve. “The resulting synergy between science and business and the smart implementation of new sustainable technologies is what makes Ülemiste the most unique environment in the Nordic region for different testing purposes – the TestCity.”
According to Ursel Velve, Ülemiste City invests in creating an ecosystem where testing is a natural part of product development and service design, keeping the focus on the green transition as well as the health and smart city innovation. She says that Ülemiste City is different from other North-European testing environments because of its more significant and more versatile selection of services supported by the actual urban environment in a limited area functioning as a mini-city model.
“Ülemiste Test City, Tallinn and Estonia offer a physical testing environment at the level of a business campus, city as well as a compact small state, supported by data and modern technologies necessary for making leadership decisions as well as talents interested in technology who can contribute to the value chain from the beginning till the end,” said Ursel Velve. She added that Test City’s value also lies in bringing together businesses of different sizes and areas of activity, facilitating the creation of new services and business models.
Several services have undergone a testing process within the framework of the Test City concept. Logistics firm DPD recently tested package delivery with Clevon’s robot courier CLEVON 1. Auvetech Modern Mobility has also tested their self-driving demand-based transportation service on the campus, Fyma its artificial intelligence-based mobility data solution, R8 Technologies its artificial intelligence-based energy management of buildings, Kone Insight its building usage statistics service, Ringo its reusable food packaging service and Active Health its health management platform.
Skeleton Technologies is expanding its test lab in Ülemiste Test City. The company’s board member Ants Vill said they would like to test Skeleton’s technologies more widely in Estonia. “We highly value the level of local engineering, which is extremely competitive in the global context today, and we wish that there would be more engineering professionals in Estonia to enable us to create more value through the development and implementation of deep technology to combat global climate change,” he added.
Representative of Enterprise Estonia Joonas Vänto stated that all kinds of test environments, labs or incubators that gather innovation also attract talent. “In terms of location, Ülemiste City is truly great. It is a business district within the city where new technologies could be tested. Estonia increasingly attracts forward-looking international companies which in turn increases the interest of foreign workforce in our opportunities. We see that Estonia in cooperation with the city of Tallinn and Ülemiste City is becoming a talent magnet where people want to work,” he noted.
Ülemiste City (https://www.ulemistecity.ee/en) located in Tallinn’s international traffic junction is the biggest business area in the Baltics developed by Mainor Ülemiste and Technopolis Ülemiste. The City’s 36 hectare-area includes 167 000 square metres of rentable office spaces. The area hosts more than 500 businesses and provides a work, home and living environment for nearly 16 000 people.
Ülemiste City, focused on a research-based and open economy, is having an ever-increasing impact on the entire Estonian economy, having taken up third place in the country’s business areas within the past few years. The total turnover of the 500 companies occupying the business area in 2022 was about 2 billion euros, of which one billion was made up by export.
Ülemiste Test City in numbers:
over 500 enterprises
167 000 m² of office spaces
44 226 m² of green areas
16 000 people working, studying of living in the area – about 15% of staff are from about 70 foreign countries
The annual turnover of the business area’s enterprises is 2 billion euros
Over 50% of Ülemiste City’s enterprises cooperate with research and development institutions; 70% of enterprises develop innovative products and services
More than 1/3 of Estonia’s IT-export is produced in Ülemiste City
9 successful Test City projects
The first health technology accelerator Health Founders within the Baltics
Featured image: The most unique testing environment for new technologies in the Baltic and Nordic regions opened in the Ülemiste City business area in Tallinn is welcoming local and foreign companies to test their new solutions or validate their services in a natural city environment. (Ülemiste City)
Chair of the European Union Affairs Committee Liisa Pakosta underlined that Estonia already was the largest producer in the EU of rare earths and several critical raw materials. “We mine, and mining is part of our prosperity. As regards further extraction permits, it is important that Estonia makes all its decisions itself,” Pakosta pointed out, and stated that mineral resources and recovery of critical elements were a key issue for Estonia.
“From mobile phones to windmills, more necessary raw materials are needed than there are known geological resources. It is clear that critical materials in the mining waste should be recycled more effectively in order to recover as many critical raw materials as possible for producing, for, example, new chips, magnets or batteries,” Pakosta said. “The more we are able to refine mining waste and increase the recycling of raw materials, the less critical raw materials need to be extracted.”
Member of the European Union Affairs Committee Tanel Kiik pointed out that in order to recycle waste effectively, it was important to have a just transition fund so that companies could apply for money to set up, for example, a recycling plant for lithium-ion batteries. “The European Union Affairs Committee decided to amend the positions by adding a clause according to which it is necessary to establish an all-European support fund for granting state aid that would be specifically dedicated to financing critical raw materials projects and to which all businesses of the EU would have equal access,” Kiik said.
The European Union initiative aims to provide a strong industrial base and to ensure a secure, diversified, affordable and sustainable supply of critical raw materials, as well as to enhance circularity and sustainability. The target is to produce and process 50% of the critical raw materials needed by the EU in the European Union by 2030.
At the sitting, Director of Mineral Resources Department of the Ministry of Economic Affairs and Communications Ene Jürjens and Adviser of the Environmental Management Department of the Ministry of the Environment Piret Otsason gave an overview of the initiative and replied to the questions of the members of the European Union Affairs Committee.
For more information, please contact: Liisa Pakosta, phone +372 502 6191
The deliberation of the Bill on Amendments to the Alcohol, Tobacco, Fuel and Electricity Excise Duty Act and the Act on Amendments to the Alcohol, Tobacco, Fuel and Electricity Excise Duty Act and Other Acts (145 SE), initiated by the Government, which had been declared to be a matter of confidence in the Government before the second reading, was adjourned at today’s sitting. The Bill will raise the excise duty rates on alcohol and tobacco products in order to increase excise revenue and to influence the availability of alcohol and tobacco products.
According to the Bill, alcohol excise duty which was last raised in 2018 will rise by five per cent per year in 2024–2026. The excise duty on cigarettes and smoking tobacco which has been raised by five per cent per year in recent years will rise to the same extent in 2024–2026. The excise duty on tobacco liquids will also increase by five per cent per year over the next three years, and the minimum amount of excise duty paid will grow to the same extent in the case of cigars and cigarillos.
In the case of cigars and cigarillos, the Bill will establish the accuracy intervals of the maximum retail price in order to reduce the range of prices and thereby the workload of businesses and tax authorities. Before the second reading, the Government had introduced an amendment into the Bill according to which the maximum retail price of cigars and cigarillos would be announced to an accuracy of 10 cents, instead of 50 cents as planned earlier, if their price is up to 10 euro.
In addition, with a view to supporting the competitiveness of Estonian agricultural producers, according to the Bill, the rises in the excise duties on diesel fuel for specific purposes planned for 2024–2027 will be cancelled. This means that the rate of excise duty on diesel fuel for specific purposes will remain at 21 euro per 1000 litres.
The Bill initiated by the Government passed the first reading on 17 May, and 230 motions to amend it had been submitted by the deadline. On 8 June, the Government had decided to declare the passing of the Bill a matter of confidence before the second reading and thereby also taken over the duties of the lead committee. Motions to amend a Bill that has been declared to be a matter of confidence in the Government are not put to a vote.
During the debate, Jaak Aab, Tanel Kiik, Kersti Sarapuu, Vadim Belobrovtsev, Lauri Laats, Andre Hanimägi from the Centre Party Group, Ants Frosch, Kalle Grünthal,Evelin Poolamets from the Estonian Conservative People’s Party Group and Riina Solman, Mart Maastik and Helir-Valdor Seeder from Isamaa Parliamentary Group took the floor. The debate where all members of the Riigikogu can take the floor was also adjourned. After the end of the debate, a final vote on the Bill will be held.
During the deliberation of the Bill, the Estonian Conservative People’s Party Group moved to shorten the working hours of Thursday’s sitting and to conclude the sitting at 11.30 a.m., but the plenary did not support the motion. 27 members of the Riigikogu voted in favour of the motion and 48 were against.
At its Thursday’s sitting, the Riigikogu could not deliberate three Bills – the Bill on Amendments to the Gambling Tax Act (146 SE), the Bill on Amendments to the Value-Added Tax Act (147 SE), initiated by the Government, and the Bill on Amendments to the Income Tax Act and the Military Service Act (148 SE), initiated by the Government, – which had been declared to be a matter of confidence in the Government before the second reading.
In addition to them, the first reading of the Bill on Amendments to the Municipal Council Election Act (2 SE), initiated by the Estonian Conservative People’s Party Group, the Bill on Amendments to the Municipal Council Election Act (4 SE), initiated by the Estonian Conservative People’s Party Group, the Bill on Amendments to the Municipal Council Election Act and the Language Act (11 SE), initiated by Isamaa Parliamentary Group, the Bill on Amendments to the Municipal Council Election Act (18 SE), initiated by Isamaa Parliamentary Group, the Bill on Amendments to the Language Act (1 SE), initiated by the Estonian Conservative People’s Party Group, the Bill on Amendments to the State Pension Insurance Act (5 SE), initiated by the Centre Party Group, the Bill on Amendments to the Occupational Health and Safety Act and the Health Insurance Act (7 SE), initiated by the Centre Party Group, and the Bill on Amendments to the State Pension Insurance Act (15 SE), initiated by the Centre Party Group, will be deferred due to the end of the working hours.
The replying to the interpellations concerning the integral impact of the tax package (No. 235), the removal of the statue of the Bronze Soldier (No. 45), the border infrastructure (No. 195), the use of electronic cigarettes (No. 377), the allowance for sick leave days (No. 39), the establishment of Tallinn Hospital (No. 53 and No. 117), the health care situation (No. 104 and No. 494), the funding of health care (No. 519), alcohol-related deaths (No. 485), the treatment waiting lists (No. 486), drug-related deaths (No. 496), the situation of Ida-Viru County (No. 12 and No. 56), the sustainability of the postal service in Estonia (No. 22), cormorants (No. 276), the halting of urbanisation, and the disappearance of rural life (No. 376) and regional disparities (No. 495) will also be deferred as there was no time to deliberate them. The Minister of Social Protection Signe Riisalo did not reply to the interpellation concerning the integral impact of the tax package (No. 433) because the interpellators withdrew it.
Today’s sitting of the Riigikogu began with the submission of interpellations and the delivery of Bills and draft Resolutions which lasted for about an hour. After that, Vice-President of the Riigikogu Toomas Kivimägi declared a recess. A meeting of the Board was held to discuss the issue relating to the conclusion of the opening of the sitting in order to start the deliberation of the Bills and draft Resolutions and interpellations on the agenda. As the Board was not unanimous and there was no consensus, a vote to stop the submission of interpellations and the delivery of Bills and draft Resolutions at the ongoing sitting was held. With 53 votes in favour, 1 against and 1 abstention, the deliberation of the Bills on the approved agenda began.
The video recording of the sitting will be available to watch later on the Riigikogu YouTube channel. (Please note that the recording will be uploaded with a delay.)
