Extraordinary Session

The Riigikogu passed at the extraordinary session with 78 votes in favour (4 votes against) the Act on the Ratification of the State Border Treaty between the Republic of Estonia and the Russian Federation and the Treaty on the Delimitation of Maritime Areas of Narva Bay and the Gulf of Finland between the Republic of Estonia and the Russian Federation (660 SE), initiated by the Government of the Republic. The preamble of the Act states that, proceeding from the legal continuity of the Republic of Estonia, proclaimed on 24 February 1918, as it is stipulated in the Constitution of the Republic of Estonia, from the resolution of the Republic of Estonia Supreme Council of 20 August 1991 ?On the National Independence of Estonia? and from the declaration of the Riigikogu of 7 October 1992 ?On the Restoration of Constitutional Power?, and keeping in mind that the Treaty, named in Article 1 of this Act, in accordance to Article 122 of the Constitution of the Republic of Estonia, partially amends the state border line, established by Article III section I of the Tartu Peace Treaty of 2 February 1920, does not influence the rest of the Treaty, and does not determine the treatment of bilateral issues, not connected with border treaties, the Riigikogu decided to ratify the Border Treaties, signed in Moscow on 18 May 2005.

The Riigikogu passed with 55 votes in favour (11 votes against) the Income Tax Act, Social Tax Act and Associated Acts Amendment Act (658 SE), initiated by the Estonian People?s Union Faction, Estonian Reform Party Faction and Estonian Centre Party Faction, the purpose of which is the fulfilment of the Coalition Agreement, which forms the basis for the activities of the Government, regarding the items related to the income tax. With regard to the income tax, the Coalition Agreement includes the following items: to establish a supplementary income tax exemption in the amount of exempt minimum beginning from the second child of the family from 1 January 2006; to reduce the rate of income tax by 1 per cent in a year to 20 per cent as from 2009; to increase the basic monthly exemption of a resident natural person to EEK 2,000 beginning from 1 January 2006; to increase the rate allocated to local governments from the income taxes of natural persons to 11.8 per cent from the gross income beginning from 1 January 2006. The gradual  increase of the basic exemption of a resident natural person (since the year 2006 up to EEK 24,000 in a calendar year or EEK 2,000 in a month) has already been established by the Income Tax Act, Social Tax Act and Land Tax Act Amendment Act, passed by the Riigikogu on 17 December 2003. Therefore it is not necessary to make supplementary amendments to the Acts for the increase of basic exemption. In addition to the Coalition Agreement, the amendment was made, which proceeds from the Directive of the Council of the EU on taxation of savings income in the form of interest payments and establishes the date of entry into force of the provisions in the Income Tax Act, necessary for the implementation of the Directive.

The Riigikogu Press Service