ECTU calls for tax reform

  • 2010-06-17
  • From wire reports

TALLINN - The council of the Estonian Confederation of Trade Unions (ECTU) on June 11 approved of the trade unions’ positions on taxation policy, reports news agency LETA. The organization considers it necessary to increase the share of direct taxes in the state’s tax revenue and decrease the share of indirect taxes.

In order to remove the shortcomings of the current taxation policy and guarantee a balanced development in the society, the ECTU considers it necessary to decrease the share of indirect taxes (such as VAT and excise taxes) in the state’s tax revenue, in order to improve the situation for people with lower incomes.
The trade unions feel that in order to guarantee a tax system with greater social justice, the progressive nature of individuals’ income tax needs to be increased. Imposing taxes on capital and property is also necessary, in the opinion of trade unions, while maintaining exceptions on principal residences.

In order to increase the state’s revenue base, the organization wants to restore company income tax. The organization also estimates that the state should impose an obligatory insurance to cover work-related accidents and professional ailments, as this would motivate companies to improve the work environment, help improve public health and decrease pressure on the medical insurance and state pension insurance budgets.

“Estonia needs taxation policy measures that would motivate accumulating savings during the periods of fast economic growth and help avoid economic over-heating, while in the context of decelerating economic growth or economic decline would favor the use of savings,” stated the council of the trade unions’ confederation.
On the basis of the council’s decision, the ECTU will start negotiations with political parties and relevant state authorities with the aim of increasing the efficiency of the Estonian tax system.