- The Chamber of Commerce does not support the proposed car tax, which has neither a clear purpose nor an understandable impact
The Chamber of Commerce does not support the proposed car tax, which has neither a clear purpose nor an understandable impact
The Estonian Chamber of Commerce and Industry turned to the Ministry of Finance and, in its opinion, pointed out very important and fundamental questions, which must be answered before the ministry starts drafting the law of Tax on motor vehicles.
It remains unclear to the Chamber of Commerce what is the purpose of the planned tax on motor vehicles. The Chamber raised the question whether, according to the Ministry of Finance, the tax on motor vehicles is an environmental tax or a property tax, and wants to know how much the introduction of the tax on motor vehicles helps to reduce vehicle CO2 emissions? At the same time, the Chamber is waiting for an answer as to why the consumption of old vehicles until their end must be preferred to new and more environmentally friendly vehicles, and whether the state is planning to make changes in the organization of public transport in order to encourage the use of public transport even more? Answers must be found to these and many other questions raised by the Chamber of Commerce before the Ministry starts preparing the draft of law for tax on motor vehicles.
The effect the tax would have on the stratification of the population would also need to be analysed separately, since, for example, in rural areas, children's participation in hobby groups or schools may prove to be more difficult and ultimately reduce their opportunities for self-fulfilment in the future.
The result of a car tax survey recently conducted among member companies of the Chamber of Commerce showed that 73 percent of respondents are against or rather against the introduction of tax on motor vehicles. It was pointed out that the taxation of motor vehicles already exists today in the form of motor fuel excises, and it corresponds very well to the "polluter pays" principle. At the moment, it seems that the main goal of introducing a new tax is to get about 120 million euros more to the state budget, but environmental goals are in the background. Many also emphasized that the planned tax is complex, unfair, and non-transparent.
"At the moment, it is not clear whether the purpose of the new tax is to meet environmental goals or only to increase the state's tax revenues, and in such situation it is not possible to discuss the details of the planned tax," said Mait Palts, general director of the Chamber of Commerce, and added that if the goal is to get additional money to cover other reasonable expenses, more suitable solutions should be sought for this purpose, for example within the framework of VAT or income tax, and the argument that such tax exists in other countries and not in Estonia cannot be taken seriously.
If the Ministry of Finance has given comprehensive answers to the questions presented by the Chamber and made additional analyses and still considers it necessary and reasonable to introduce a tax on motor vehicles, then the Chamber of Commerce considers it important that the new tax is based on the following principles: only vehicles in active use, i.e. vehicles with valid traffic insurance, must be taxed; the collection of the tax could be done through traffic insurance and it should be a targeted tax aimed at the maintenance and development of the road infrastructure, or at least the promotion of less polluting mobility options.