Estonian parlt rejects bills seeking to lower VAT on food products

TALLINN – The Estonian parliament on Thursday rejected at first reading bills by the opposition Center Party and the opposition Estonian Conservative People's Party (EKRE), according to which the VAT on food products would have been reduced to 9 percent with one bill and to 5 percent with the other.

The parliamentary group of the Center Party submitted a draft resolution proposing to the government to lower the VAT on vegetables, dairy, meat, grain and fish products to 9 percent. The aim of the draft was to lower the prices of food products in the context of general price increases.

Altogether 15 MPs voted in favor of the bill. Thus, the bill was dropped from the Riigikogu proceedings, as a majority of the MPs was required for the decision to enter into force.

EKRE wanted to lower the VAT on food products to 5 percent with the draft law amending the Value Added Tax Act in order to curb the rise in food prices. The current law sets the VAT on food products, including potatoes, fruit and vegetables, at 22 percent.

As the leading committee, the parliamentary finance committee proposed to reject the bill at first reading. Altogether 44 MPs voted in favor of rejecting the bill and 14 against. Thus, the bill was dropped from the Riigikogu's proceedings.