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Ligi: if one tax falls in Estonia, another one increases

BC, Tallinn, 21.03.2014.Print version
The outgoing Estonian junior coalition partner Pro Patria and Res Public Union (IRL) sharply criticises the new Reform Party–Social Democratic Party coalition and their coalition agreement for excessive spending: Estonia finance minister Jürgen Ligi stressed again that all costs are covered: if one tax falls, another increases, LETA/Public Broadcasting reports.

The coalition agreement that was concluded on Thursday was talked about at the probably last press conference of the IRL-Reform Party government, where Ligi defended the planned expenditures and IRL's chairman Urmas Reinsalu attacked the new coalition agreement.

 

The government decided on Thursday, among other things, to supplement the list of goods subject to reverse charge, with all precious metals and stones. Ligi said that fighting against tax fraud is one way of getting finances to implement the new coalition agreement.

 

Ligi said that it is sad that suspicions are voiced about finding financing for the coalition agreement costs and said that there is no bluff. "First, I draw your attention to the fact that the annual budgetary growth is bigger than the cost of that coalition agreement," said Ligi.

 

Ligi said that a half of the 172 million euros necessary to finance the coalition agreement comes from more flexible financial management, for example better planning of projects co-financed by the EU and abolishing forced expenditures, for example that 75% of fuel excise tax has to be spent on road construction.

 

One source is excise tax increase. Faster than planned increase of excise taxes of vices, alcohol and tobacco should yield 19 mln euros, for example, but Ligi said that gas dependency can be also called a vice.

 

"Excise tax on gas is very low and in the current international context especially, special attention could be paid to that," said Ligi, adding that the plan is to increase gas excise tax by 20% which means a real increase of heating bills by 1%.

 

IRL's chairman Urmas Reinsalu said that the new government should have first waited for the spring economic forecast before hastily making decisions on spending.






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