More than 50,000 citizens have already signed a public initiative calling for a reduction in value-added tax on food products to 10 percent, writes ERR News.
From the 1st of July, the VAT rate in Estonia for all goods, including food, was increased to 24%, which is one of the highest rates in the European Union.
The initiative, which can be signed on Rahvaalgatus.ee, was opened on the 30th of June, and it is planned to show the Estonian parliament that the tax burden increases inequality and that consumers should allocate a larger share of the budget for food.
This is one of the most popular initiatives during the existence of the platform. More signatures were collected only for the abolition of the car operating tax, where a total of 65,565 people signed. Since the collection of signatures for a reduction in VAT on food will continue until the 11th of August, it is likely that this will become the most popular initiative.
Once the initiative receives more than 1,000 digital signatures, it will be forwarded to parliament. Signatures must be verified with an ID card.
The bills on reducing VAT on food, proposed by opposition parties, were rejected in April.
The initiative is also supported by Lauri Läänemets, the chairman of the Estonian Social Democratic Party, who in February proposed reducing VAT on food to 9%. He noted that it is necessary to reduce VAT on food, as this not only improves the living conditions of residents, but also indirectly helps Estonian farmers and food producers. Läänemets added that food prices in Estonia are absurdly high, and reducing VAT could change this. At the same time, the politician admitted that if VAT on food is reduced, it is important to ensure that this is reflected in prices in stores, and not simply increases sellers’ profits.
Estonian Finance Minister Jürgen Ligi said that it is impossible to lower the VAT on food because, in his opinion, it will only fill the pockets of traders, and called the discussion on this issue populist and shameless. Meanwhile, Science and Education Minister Kristina Kallas said that the VAT on food cannot be lowered because the state does not have the funds for it.
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