New government plans to raise VAT to 24% in Estonia by 2026

• New government plans to raise VAT, income tax, and excise duty on alcohol, tobacco, and gasoline
• VAT and income tax to increase to 24% by 2026
• Introduction of a 2% tax on corporate profits as part of defense tax
• Defense spending to be kept at 3% and costs of hosting NATO allies to be covered
• Plans to acquire long-range weapon systems and strengthen digital defense capability
• Budget deficit to be reduced from 5.6% to 3% by 2025
• Labor and management costs in ministries to be cut by 10% within three years
• Excise duties on alcohol, tobacco, and gasoline to increase by 5% per year
• Delay in elimination of income tax-free threshold
• Universities allowed to introduce fees for Estonian-language curricula in certain cases
• Plans to cut red tape and bureaucracy
• Speeding up construction of Rail Baltic and investments in railway electrification
• State budget to be made more understandable
• Cuts to labor, management, operating costs, and subsidies by 10% over three years
• Cuts to foundations and state-owned enterprises planned.

Source: news.err.ee

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Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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