Prime Minister Kristen Michal said that the cancellation of the car tax will definitely be discussed. However, this will happen only after discussions on defense spending, income tax increases, and wage hikes.
Michal stated that the state's finances are in better condition than expected. The state has nearly 800 million euros more than anticipated. This shows that the economy is doing well. More income tax has been collected, and investments have been reduced. Now it's time to discuss what to do next with next year's budget.
The Prime Minister emphasized that defense spending is the first priority. The state must spend at least 5% of GDP on defense. This is necessary for Estonians to live in peace in the future. There is also room in the budget for wage increases in important sectors, such as teachers, culture, and police. After that, the cancellation of the income tax increase can be discussed.
Michal said that the car tax issue will definitely be discussed. He himself is critical of the car tax. In his opinion, Estonians have not understood this tax. He wants people to have more money in their hands. For this reason, the tax-free income threshold should be increased, and the income tax hike should be abandoned. The discussion on the car tax must be sustainable in the long term.
The Prime Minister confirmed that Kristina Kallas, the head of Eesti 200, did not disrupt his plan. The car tax will definitely be up for discussion. However, the first priorities are still defense, the cancellation of the income tax increase, and wage hikes. The car tax will be discussed after these topics.