The Riigikogu passed with 89 votes in favour the Act on Amendments to the Income Tax Act and Associated Act (723 SE) and (631 SE),initiated by the Government, the Estonian Centre Party Faction and the Social Democratic Party Faction. The amendments ensure equal treatment of persons of Estonia and persons of the European Economic Area in taxation by extending certain tax incentives to all residents of the European Economic Area. The procedure for taxation of share options is also specified. According to the amendments, share options are not taxed at the moment of granting and a share option is not deemed to be a fringe benefit if it is realised after three years have passed from granting of the option. Employers’ options help motivate employees, involve them in the activities of the company, increase their productivity and effectiveness and reduce frequent personnel changes. At the same time, options harmonise the interests of the management board of the company and shareholders. In general, share options contribute to the development of the company and, indirectly, of the economy as well. This Act also provides uniformly interpretable rules for transfer of the enterprise belonging to a sole proprietor exempt from income tax. This amendment is due to the need to enable an enterprise to be transferred without income tax liability arising also to another sole proprietor (so-called transfer of the business from father to son) who will continue the activities of the enterprise. The Act enters into force on 1 January 2011, and clause 1 90) and clause 5 3) enter into force on 1 January 2012.
The Act on Ratification of the Treaty between the Republic of Estonia and the People’s Republic of China on Mutual Judicial Assistance in Criminal Matters
), initiated by the Government, was passed with 83 votes in favour. This treaty was signed on 12 June 2002 and its purpose is to provide extensive mutual assistance in criminal matters. This Treaty does not apply to the extradition of any person, the enforcement of judgments, the transfer of the sentenced person for serving sentence (the exchange of prisoners) and the transfer of criminal proceedings.
The Act on the Ratification of the Final Acts of the 24th Congress of the Universal Postal Union
), initiated by the Government, was passed with 78 votes in favour. The Universal Postal Union (UPU) is a specialised agency of the United Nations which coordinates the global cooperation of the postal service providers, establishes the rules for providing the universal postal service and makes recommendations for the development of international postal services and for enhancing their quality. The Eighth Additional Protocol to the Constitution of the Universal Postal Union, the First Additional Protocol to the General Regulations of the Universal Postal Union and the Convention which were signed at the 24th Congress of the Universal Postal Union are to be ratified. The Additional Protocols are documents concerning the organisation the work of the Universal Postal Union and they involve no additional obligations for member countries. The Convention contains the rules applicable throughout the international postal service and it is binding on all member countries. Member countries will ensure that their designated operators fulfil the obligations arising out of the Convention.
The Act on Approval of Amendment of the Articles of Agreement of the International Monetary Fund
), initiated by the Government, was passed with 78 votes in favour. The said amendment of the Articles of Agreement concerns enhancing of voice and participation in the Monetary Fund and expanding of the investment authority. The amendment concerning the enhancing of voice and participation is part of the quota and voting right reform which aims to ensure better representation and stronger voting right in the IMF for states with dynamically developed economy, including Estonia. The purpose of the other amendment is to ensure sustainable financing of the activities of the IMF. The amendment makes the income of the IMF less dependent on the interest income received from lending activities. When the amendments to the Articles of Agreement of the IMF enter into force, the IMF will be authorised to adjust the investment policy as necessary and the revenues from the sale of a limited amount of the IMF gold resources will be allowed to be used for investments.
On the motion of the Constitutional Committee, the second reading of the Bill on Amendments to the State Secrets and Classified Information of Foreign States Act and Other Acts
), initiated by the Government, was concluded. The amendments are intended to eliminate the bottlenecks and implementation difficulties which became apparent upon the entry into force of the new State Secrets and Classified Information of Foreign States Act. The aim is to reduce the disputes arising in the interpretation of the Act and the burden of the relevant authorities, by eliminating unnecessary requirements. This Act also amends the Gambling Act and the Emergency Act. The Bill was sent to the third reading.
On the motion of the Cultural Affairs Committee, the second reading of the Bill on Amendments to the Universities Act and Associated Acts
), initiated by the Government, was concluded. The Act amends the Universities Act, the Private Schools Act and the Institutions of Professional Higher Education Act and the main purpose of the amendments is to formulate more clearly the relevant provisions of the external evaluation of the higher education and thereby to ensure better implementation of this regulation. The Bill was sent to the third reading.
On the motion of the Finance Committee, the second reading of the Bill on Amendments to the State Budget of 2010 Act
), initiated by the Government, was concluded. The amendments to the budget are related to the significant changes that have occurred in the (economic) environment during the last year and therefore it is deemed expedient to adjust the budget to the changed circumstances in order to achieve the objectives set by government authorities. The amendments concern the budgets of the State Chancellery, ministries, their divisions, and other constitutional institutions. As the initiator asserted, this will not affect the volume of the state budget. The Bill was sent to the third reading.
On the motion of the Economic Affairs Committee, the first reading of the Bill on Amendments to the Law of Obligations Act and the Consumer Protection Act
), initiated by the Government, was concluded. The main task of the amendments is to harmonise the regulation of consumer contracts in the Law of Obligations Act to a greater extent with European Union directives in order to prevent initiation of new infringement proceedings against Estonia and to ensure termination of the proceedings which have already been initiated. In addition, several proposals are made within the framework of the Bill to bring the Law of Obligations Act into conformity with the provisions regulating the consumer’s contractual rights which the Commission has not pointed out so far. Another important aim is to update the Law of Obligations Act for example as regards the regulation of advance payments in case of consumer contracts. The Bill was sent to the second reading.
On the motion of the Constitutional Committee, the first reading of the State Liability Bill
), initiated by the Government, was concluded. The main purpose of the Bill is to integrate the regulation of the compensation for damage caused by the state to a person by unjust deprivation of liberty which so far was regulated by a separate Act with the State Liability Act and to eliminate the deficiencies which have become apparent in the implementation practice. The merging of the Acts gave rise to so numerous amendments that it was necessary to submit a new consolidated text of the State Liability Act. The Bill was sent to the second reading.
On the motion of the Constitutional Committee, the first reading of the Bill on Amendments to the Prosecutor’s Office Act
), initiated by the Government, was concluded. The purpose of the Bill is to additionally ensure independence of the Prosecutor’s Office from undesired influences, and the corresponding accountability and responsibility which are necessary prerequisites for the administration of justice in a state based on the rule of law. The amendments will improve the guarantees of the independence of prosecutors which will have to contribute to the continuing development of the impartiality, objectivity and autonomy of the activities of the Prosecutor’s Office (including protection against inappropriate political influence); through transparency of the activities of the Prosecutor’s Office and reporting before the Constitutional Committee of the Riigikogu, the quality of the administration of justice as a whole should improve. The Bill was sent to the second reading.
On the motion of the Economic Affairs Committee, the first reading of the General Part of the Economic Activities Code Bill
), initiated by the Government, was concluded. The purpose of the Code is to establish a uniform legal basis to the allowing, restricting and prohibiting of economic activities by the state. The Bill has been prepared in view of the aim to create a general framework for all regulations which provide the requirement for the undertakings to register themselves or their activities or to obtain all kinds of activity licences, licences, approvals, etc. The general part of this Code will have to ensure that the special regulations of economic activities are in conformity with the Constitution, international law and European Union law and, in addition, support the exercise of the fundamental economic freedoms of persons, that is, increase freedom of economic activities. As a final result, the amount, extent and complexity of the regulations containing economic administration law will decrease which will mean less bureaucracy. The Bill was sent to the second reading.
On the motion of the Environmental Committee, the first reading of the General Part of the Environmental Code Bill
), initiated by the Government, was concluded. The purpose of the Act is to reduce environmental nuisances to the highest possible extent in order to protect the environment, human health, welfare, property and cultural heritage; to promote sustainable development in order to ensure an environment corresponding to the health and welfare needs for this generation and the generations to come; to preserve and protect natural diversity; to preserve the good state of the environment and to prevent damage to the environment and to compensate for the damage caused to the environment. The Act provides the principles and main obligations of the environmental protection, the obligations of operators and the environmental rights and regulates the authorisation procedure. The Bill was sent to the second reading.
On the motion of the Finance Committee, the first reading of the State Budget of 2011 Bill
), initiated by the Government, was concluded. According to the Bill, the revenue of the state will increase by over 2%, that is, to 5.7 billion euro (89.4 kroons) next year. The increase of the revenue is primarily connected to the increased accrual of the taxable revenue, the value added tax and social tax covering the largest share. The contribution of non-taxable revenue to the budget will reduce by nearly 4%, in comparison to 2010. The volume of the budget expenditure will increase by 5%, to 6 billion euro (94.2 billion kroons). The Minister of Finance Jürgen Ligi
stated that the expenditure will grow primarily on account of associated income, that is, foreign funds and sale of the emission quota. The increase of the budget volume is also due to the resumption of funded pension contributions and the increase of pension payments in connection with the growing number of pensioners. Education is a long-term priority in the budget and a next year’s priority, too, the growth amounting to nearly 8%. The growth of defence spending will increase to 1.9% of GDP and social sphere expenses will increase by 154 million euro. In the Minister’s words, the maintenance expenses of the state will not increase next year. In the words of the Minister of Finance, in 2011, the receipt of supports will increase by 12%, to 1.9 billion euro, including foreign supports which are planned to amount to 1 billion euro. The use of foreign support in comparison to 2010 will increase most in the Ministry of the Environment, the Ministry of Internal Affairs and the Ministry of Social Affairs. The Bill was sent to the second reading.
On the motion of the Finance Committee, the first reading of the Bill on Amendments to the Labour Market Services and Benefits Act and the Unemployment Insurance Act
), initiated by the Government, was concluded. The Bill is intended to change the organisation of the unemployment insurance in the current Unemployment Insurance Act. According to the amendment, in the future, the employment services and labour market benefits offered to insured persons, except for the unemployment allowance, will also be financed from the collected unemployment insurance funds.
For that purpose, the labour market services and benefits foundation capital will be established. The Social Democratic Party Faction and the Estonian Centre Party Faction moved to reject this Bill at the first reading. 29 members of the Riigikogu voted in favour of the motion and 46 voted against, nobody abstained. Thus, the motion was not supported and the Bill was sent to the second reading.
On the motion of the Environmental Committee, the first reading of the Bill on Amendments to the Environmental Charges Act and the Euro Adoption Act
), initiated by the Government, was concluded. The amendments are due to the need to specify certain legal regulations related to the implementation of the environmental charges and to formulate more precisely certain provisions in the Act; the provisions concerning the calculation and payment of the pollution charge for ambient air emissions and waste and the fee for mineral rights are specified. The Bill was sent to the second reading.
On the motion of the Economic Affairs Committee, the first reading of the Bill on Amendments to the Chemicals Act, the Integrated Pollution Prevention and Control Act, the Rescue Act and the State Fees Act
), initiatedby the Government, was concluded. The main purpose of the Bill is to organise the regulation related to the right of activity of dangerous enterprises and enterprises liable to be affected by a major accident. It also specifies the practically unlimited right of discretion of the Government to interfere with the right to free entrepreneurship and to prohibit, restrict or suspend the activities of an enterprise liable to be affected by a major accident, taking account of the principles of the rule of law and the requirements arising from the Constitution. The Bill was sent to the second reading.
At Question Time, Prime Minister Andrus Ansip answered the question about availability of medical care on small islands and in borderlands, submitted by Mark Soosaar, and the question about the balance of the government sector budget, submitted by Hannes Astok. The Minister of Regional Affairs Siim Valmar Kiisler answered the question about forced merger of local governments, submitted by Kadri Simson, the question about the negotiations of the government committee and the Local Government Associations Co-operation Assembly delegation, submitted by Arvo Sarapuu, and the question about merger of local governments, submitted by Jaan Õunapuu. The Minister of the Environment Jaanus Tamkivi answered the question about transfer of lands to the use for civilian purposes, submitted by Rein Ratas, the question about restrictions on fishing for shrimps and the national interests of Estonia, submitted by Maret Merisaar, and the question about purity and preservation of the nature of Estonia, submitted by Nikolai Põdramägi.
The sitting ended at 8.50 p.m.
The verbatim record of the sitting (in Estonian) is available at:
The Riigikogu Press Service