{"id":52316,"date":"2024-11-13T21:59:44","date_gmt":"2024-11-13T19:59:44","guid":{"rendered":"https:\/\/www.riigikogu.ee\/pressiteated\/the-bill-on-next-year-s-state-budget-passed-the-second-reading-in-the-riigikogu\/"},"modified":"2026-08-27T15:10:20","modified_gmt":"2026-08-27T12:10:20","slug":"the-bill-on-next-year-s-state-budget-passed-the-second-reading-in-the-riigikogu","status":"publish","type":"post","link":"https:\/\/www.riigikogu.ee\/en\/pressiteated\/the-bill-on-next-year-s-state-budget-passed-the-second-reading-in-the-riigikogu\/","title":{"rendered":"The Bill on next year\u2019s state budget passed the second reading in the Riigikogu"},"content":{"rendered":"

According to the State Budget for 2025 Bill<\/strong> (513 SE<\/a>), initiated by the Government, the revenue of the state budget will be EUR 17.7 billion and the expenditure will be 18.2 billion. Compared to this year\u2019s budget, revenues will grow by EUR 0.9 billion or 5.2 per cent and expenditure by EUR 0.6 billion or 3.5 per cent. The budget foresees EUR 1.9 billion in investments and investment grants.<\/p>\n

According to the Bill, the tax burden in 2025 will be 35.8% of GDP. The general government deficit remains at the level of three percent of GDP, which fulfils the Maastricht budget balance rule. In next year’s draft state budget, the Government has set the goal of ensuring the security of the people and the state, cleaning up public finances, and ensuring sustainable economic growth.<\/p>\n

Members of the Riigikogu and parliamentary groups had submitted 59 motions to amend the Bill for its second reading. Six of them did not comply with the requirements and the Finance Committee had refused to consider them and to enter them in the list of motions to amend. The Committee had not accepted the remaining amendments. At the same time, the Committee in cooperation with ministries made a motion to amend the Bill consisting of several parts containing specifications within and between the areas of government of ministries.<\/p>\n

Lauri Laats<\/strong>, Vadim Belobrovtsev<\/strong> and Anastassia Kovalenko-K\u00f5lvart<\/strong> from the Centre Party Group, Rain Epler<\/strong>, Arvo Aller<\/strong>, Martin Helme<\/strong> and Varro Vooglaid<\/strong> from the Estonian Conservative People’s Party Group, Helir-Valdor Seeder<\/strong>, Andres Metsoja<\/strong>, Mart Maastik<\/strong>, T\u00f5nis Lukas<\/strong>, Priit Sibul<\/strong>, Aivar Kokk<\/strong> and Urmas Reinsalu<\/strong> from Isamaa Parliamentary Group and Maris Lauri<\/strong> from the Reform Party Parliamentary Group took the floor during the debate. Jaak Aab<\/strong> took the floor on behalf of the Social Democratic Party Group. Non-attached Members of the Riigikogu Jaanus Karilaid<\/strong>, Kalle Gr\u00fcnthal<\/strong>, and Leo Kunnas<\/strong> also made speeches.<\/p>\n

The Centre Party Group, the Estonian Conservative People\u2019s Party Group and Isamaa Parliamentary Group moved to suspend the second reading of the Bill, but the Riigikogu did not support the motion. 21 members of the Riigikogu supported suspension of the deliberation but 59 were against. Thus, the Bill passed the second reading.<\/p>\n

Committees and parliamentary groups can submit motions to amend the State Budget for 2025 Bill for its third reading until 5.15 pm on 28 November.<\/p>\n

The Riigikogu passed four Acts<\/strong><\/p>\n

At Wednesday’s sitting, the Riigikogu passed the Act on Amendments to the Income Tax Act and the Funded Pensions Act<\/strong> (434 SE<\/a>), initiated by the Government. It creates opportunities to invest in more financial instruments than before. To this end, the list of financial assets in the investment account are extended to include covered bonds, regulated crowdfunding instruments, and regulated crypto assets.<\/p>\n

The amendments allow for the deduction of indirect costs, such as the management fee of a securities account, in addition to direct transaction costs, from the income made both through an investment account and from investments outside the account. They also allow for the offsetting of gains and losses when investing in crowdfunding and crypto-assets outside the investment account. In addition, units in unauthorised small funds, which by their nature should not be included in the list of financial assets, are excluded from the authorised financial assets of the investment account.<\/p>\n

71 members of the Riigikogu supported the passing of the Act, and there was one abstention.<\/p>\n

The Riigikogu passed the Act on Amendments to the Value Added Tax Act and the Taxation Act <\/strong>(462 SE<\/a>), initiated by the Government. It establishes a special scheme for small enterprises from next year to simplify their operation in other European Union countries.<\/p>\n

If an enterprise generates turnover in another member state, it will no longer have to be registered for VAT purposes there if two conditions are met. First, the calendar year turnover of the enterprise in the relevant Member State must not exceed the ceiling at which the obligation of registration arises there and, second, the overall turnover in the Union of the enterprise must not exceed EUR 100,000 per year. The amendments aim to reduce the administrative burden for small businesses located in the EU.<\/p>\n

The Act also amends the principle of the VAT treatment of new construction works by providing that construction works are taxable when they are sold for the first time during the first year of use. Currently, the sale of completely new construction works, i.e. construction works that have not yet been put into use, is taxable and the subsequent sale is tax-free, which has led to cases where construction works are put into use ostensibly to then be sold tax-free.<\/p>\n

In addition, the Act amends the calculation of the input VAT paid on the acquisition of fixed assets and provides that, from 2026, the form-based submission of VAT return data will be replaced by data-based submission.<\/p>\n

Urmas Reinsalu<\/strong> from Isamaa Parliamentary Group took the floor during the debate.<\/p>\n

65 members of the Riigikogu were in favour of passing the Act and one voted against.<\/p>\n

The Riigikogu passed the Act on  Amendments to the Funded Pensions Act and Other Acts<\/strong> (464 SE<\/a>), initiated by the Government. It simplifies the transfer of inherited assets in the second pension pillar of a bequeather to the pension account of a successor, allowing several transactions to be made with a single application. The purpose of the amendment is that, in addition to the current options, the successor could have the inherited assets transferred immediately to their pension fund or pension investment account where their contributions to the funded pension scheme are received.<\/p>\n

Under the Act, the conditions for closing a pension investment account will also become more flexible. An amendment specifies that the money received after the account has been closed must go to the last pension fund chosen by the person, another pension investment account or a pension contract concluded. If the money contributed to the second pillar had already been paid out to the person, the added money should reach them as an additional payment. In addition, the Act contains amendments regarding the implementation of Act European Union legislation.<\/p>\n

64 members of the Riigikogu voted in favour of passing the Act and there was one abstention.<\/p>\n

The Riigikogu also passed the Act on Amendments to the Land Register Act <\/strong>(467 SE<\/a>), initiated by the Government. It restricts the making of queries in the land register. According to an amendment, it will no longer be possible for an ordinary user to search for data in the electronic land register on the basis of the name and personal identification code of a natural person with an individual query.<\/p>\n

In order to increase the protection of private life and at the same time preserve the public nature of the land register, in the future, those who absolutely need it due to their work will be able to make queries on the basis of name or personal identification number. The current procedure will be maintained in that a land registry file may be accessed and printouts obtained only upon existence of a legitimate interest. Only the owner of the registered immovable, notary, enforcement agent, court and a supervisory body do not need to prove the legitimate interest. Everyone will continue to be able to make queries in the land registry on the basis of the address or cadastral code of the immovable.<\/p>\n

According to an amendment made during the proceedings, credit institutions for which it is inevitably necessary to make queries in order to assess the solvency of customers and sureties and to comply with the principles of responsible lending can also make individual queries on the basis of name and personal identification code. The second motion to amend concerns the increase of the threshold for the fee for the issue of land register data. While currently the fee for issuing data is up to two euro per object of query it will be up to three euro according to the amendment.<\/p>\n

Urmas Reinsalu<\/strong> from Isamaa Parliamentary Group took the floor during the debate.<\/p>\n

74 members of the Riigikogu supported the passing of the Act.<\/p>\n

Eight other Bills passed the second reading<\/strong><\/p>\n

The Bill on Amendments to the Weapons Act and Amendments to Other Associated Acts<\/strong> (468 SE<\/a>),  initiated by the Government, passed the second reading in the Riigikogu. Its purpose is to strengthen the defence industry and to ensure a competitive environment for it in Estonia. The amendments will provide an opportunity for companies in countries who have friendly relations with Estonia and engage in defence cooperation with Estonia to contribute to the Estonian defence industry.<\/p>\n

The Bill will allow for an activity licence for the handling of weapons, ammunition and munition to also be issued to companies whose owners or shareholders are not citizens of NATO or EU Member States if such companies are located in third countries who have friendly relations with Estonia and the European Union. In the future, an activity licence can also be given to citizens of Organisation for Economic Co-operation and Development (OECD) countries as well as citizens of countries with which Estonia has concluded an agreement on the exchange of classified information.<\/p>\n

The Bill will also allow companies that are not registered in Estonia but that hold an activity licence in another EU member state to provide transport services for arms, ammunition and munition. The Bill will also reduce duplication of authorisation procedures in the Weapons Act and the Explosives Act and will allow vehicles, watercraft, aircraft and other products to be manufactured without an activity licence required under the Weapons Act if no military weapon is mounted on them in the course of manufacture.<\/p>\n

Under the Bill it will become more economical to carry out background checks on employees, subcontractors and service providers of undertakings engaging in the manufacture of weapons, ammunition and munition who come into contact with weapons, ammunition and munition or information relating thereto. During the second reading, the legal bases for carrying out background checks when establishing a mini-industrial park on the territory of the Defence Forces were specified in the Bill.<\/p>\n

The Bill will amend the Code of Criminal Procedure by adding a new circumstance precluding commencement of criminal proceedings in order that people would be able to surrender military weapons in illegal possession to the Police and Border Guard Board. A new basis for classification will be included in the State Secrets and Classified Information of Foreign States Act in order to better ensure that information sensitive from the point of view of national security is processed only in an area that meets the requirements or in an accredited processing system and is done by reliable persons with the right of access and a need to know.<\/p>\n

The aim of the amendment to the Strategic Goods Act is to develop the international competitiveness of the Estonian defence industry and to create more favourable conditions for innovation and receiving financial support for development activities. According to the Bill, the State Fees Act will be amended by adding new bases related to the issue of certificates of competence. A certificate of competence will be issued to persons who handle military weapons, weapons systems, ammunition of military weapons, and munition and who have the necessary qualifications.<\/p>\n

Kristo Enn Vaga<\/strong> from the Reform Party Group and Urmas Reinsalu<\/strong> from Isamaa Parliamentary Group took the floor during the debate.<\/p>\n

The Bill on Amendments to the Imprisonment Act<\/strong> (506 SE<\/a>), initiated by the Government, passed the second reading. It will allow Tallinn Prison to also be used as a regional detention centre from 1 April next year, i.e. people who are punished by detention, detained for up to 48 hours, or subjected to compelled attendance can be lodged there.<\/p>\n

According to the explanatory memorandum, Tallinn Prison has a sufficient number of prison places and the conditions necessary for the detention of people. In the past, the provision of the detention centre service has been taken over by Tartu and Viru prisons.<\/p>\n

The amendment will not concern persons taken to recover from intoxication. They will continue to be taken to detention houses in the area of administration of the Ministry of the Interior in the Tallinn region. Nor will the functions of the detention centre be transferred to Tallinn Prison.<\/p>\n

The Bill on Amendments to the State Budget Act<\/strong> (511 SE<\/a>),  initiated by the Government, passed the second reading. It aims to increase the transparency of the state budget. Under the Bill, the activity-based breakdown will be supplemented by a breakdown of the economic content of expenditure by agency, which was earlier presented in the explanatory memorandum to the state budget.<\/p>\n

The amendment will not affect the limits set by the state budget and the flexibility in the use of the state budget which has been set for the expenditure of programme’s activities and the total amount of expenditure of a constitutional institution. In connection with an amendment to legal acts of the European Union, the current requirement for the Government to draw up and approve a stability programme will be abolished.<\/p>\n

Members of the Riigikogu and parliamentary groups had submitted 17 motions to amend the Bill for its second reading. They had not been supported in the Finance Committee and the plenary of the Riigikogu did not support them in today\u2019s votes either. The committee made two amendments to the Bill. One of them will provide for an obligation to further disaggregate expenditure by public authority in the state budget, distinguishing between seven categories of expenditure and also separately identifying statutory subsidies. The second motion to amend will amend the date of entry into force of the Bill.<\/p>\n

Anastassia Kovalenko-K\u00f5lvart<\/strong> from the Centre Party Group, Annely Akkermann<\/strong>, Aivar S\u00f5erd<\/strong> and Maris Lauri<\/strong> from the Reform Party Group, Rain Epler<\/strong> and Mart Helme<\/strong> from the Estonian Conservative People’s Party Group and Urmas Reinsalu<\/strong> and Aivar Kokk<\/strong> from Isamaa Parliamentary Group took the floor during the debate. Non-attached Member of the Riigikogu Leo Kunnas<\/strong> also made a speech.<\/p>\n

The Centre Party Group and Isamaa Parliamentary Group moved to suspend the second reading of the Bill, but the motion was not supported. 21 members of the Riigikogu supported suspension of the deliberation but 58 were against.<\/p>\n

The Bill on Amendments to the State Budget for 2024 Act<\/strong> (517 SE<\/a>), initiated by the Government, passed the second reading. The amendments to be made are related to the specified distribution of the budget within areas of government and between them. According to the State Budget Act, the Government may initiate an amendment of the State Budget Act without amending the total amount of funds not later than two months before the end of the budgetary year.<\/p>\n

The Riigikogu adopted the state budget for 2024 on 8 December last year. The state budget had a revenue volume of around EUR 16.7 billion and an expenditure volume of around 17.7 billion and an investment budget of around EUR 817 million and a financing transactions budget of 1.4 billion.<\/p>\n

In the first half of this year, the Riigikogu amended the State Budget for 2024 Act in order to make the necessary allocations for raising teachers’ salaries without amending the total amount. In order to reduce the budget deficit, the Riigikogu also approved a supplementary budget this summer. Expenditure was reduced by 103.8 million euro and investments by 22.7 million and revenues were increased by 41.9 million.<\/p>\n

The Finance Committee had made two amendments to the Bill for the second reading. One will specify the expenditure of ministries and the other will provide for a ban on the transfer of funds directed to the government reserve.<\/p>\n

Urmas Reinsalu<\/strong> and Aivar Kokk<\/strong> from Isamaa Parliamentary Group and Rain Epler<\/strong> from the Estonian Conservative People\u2019s Party Parliamentary Group took the floor during the debate.<\/p>\n

Isamaa Parliamentary Group moved to suspend the second reading of the Bill, but the motion was not supported. 19 members of the Riigikogu were in favour of suspension and 57 were against.<\/p>\n

The Bill on Amendments to the Social Welfare Act and the Health Services Organisation Act (independent nursing in the provision of the 24-hour special care service)<\/strong> (496 SE<\/a>), initiated by the Government, passed the second reading. It will make the organisation of the independent nursing offered in the 24-hour special care service more flexible. In the future it will be possible to adapt the nursing service provided and to update the content and volume of the service where necessary.<\/p>\n

Under the Bill, the organisation and funding of the service will be transferred to the Estonian Health Insurance Fund and the independent nursing offered in the provision of the 24-hour special care service will be included in the list of health services of the Estonian Health Insurance Fund. At present, nursing in the 24-hour special care service is funded through the Social Insurance Board.<\/p>\n

The Bill on Amendments to the Social Welfare Act and the Value-Added Tax Act (mental health service)<\/strong> (500 SE<\/a>),   initiated by the Government, passed the second reading. It is intended to improve the availability of psychosocial and psychological help at local level.<\/p>\n

Until now local governments have had to apply for money from the state to provide mental health services but from now on this will be included in the support fund for local governments every year. The money will be distributed in proportion to the number of inhabitants, ensuring that the minimum grant per municipality is at least 1\/250 and the maximum up to 1\/16 of the total grant. This will also allow smaller municipalities to offer the necessary mental health services. More permanent funding will give municipalities greater autonomy in offering appropriate services.<\/p>\n

Within the framework of calls for applications so far, municipalities have offered a range of services, including psychological counselling, family therapy, family counselling, creative therapies (such as music, art, and movement therapy), play therapy, crisis counselling and spiritual counselling.<\/p>\n

Lauri Laats<\/strong> from the Centre Party Group took the floor during the debate.<\/p>\n

The Bill on Amendments to the Family Benefits Act and Other Acts<\/strong> (507 SE<\/a>), initiated by the Government, passed its second reading. It will reduce the upper limit for parental benefit from 2026 which will be two times the average salary in the year preceding the calendar year prior to the year of birth of the child or the year in which the right to receive the parental benefit arises, instead of three times the average salary. This year, the upper limit is EUR 4733.53. At the same time, parental benefit will no longer be reduced if the parent earns income from work.<\/p>\n

According to the Bill the basic rate of cost-sharing per prescription for persons with health insurance will increase from EUR 2.5 to EUR 3.5 from next year. From 1 April 2025, the hospital in-patient fee will rise from EUR 2.5 to EUR 5 and the visit fee for out-patient specialised medical care will increase from EUR 5 to EUR 20. The visit fee will not increase for more vulnerable people and will therefore continue to be five euro for people receiving subsistence benefit, people with reduced capacity for work, children under 19 years of age, pregnant women, people over 63 years of age and the unemployed.<\/p>\n

Where a provider of out-patient specialised medical care leaves an insured person under observation or treatment and follow-up visits are necessary, it will be allowed to ask for a visit fee once a year in the future. According to the Bill, similar rights and restrictions on requesting visit fees will also apply to persons equal to healthcare workers, such as physiotherapists, clinical psychologists and speech therapists, who independently provide outpatient healthcare services based on a referral from a provider of family or specialised medical care.<\/p>\n

In addition, the Bill will establish an upper limit for the benefit for temporary incapacity for work. From 2026, the upper limit for the benefit for temporary incapacity for work per day will be two times the amount of the average salary in the year preceding the calendar year prior to the year in which the right to receive the benefit arises, divided by 30, similarly to parental benefit. Employers and sole proprietors will be able to compensate the difference between the upper limit of the benefit and the loss of remuneration free of social tax.<\/p>\n

According to the Bill, from next year, the state will no longer pay social security contributions for an insured person’s non-working spouse or registered partner who is raising one or two children aged between three and eight, or three to six children none of whom is under eight.<\/p>\n

At the same time, the Bill will allow the Estonian Health Insurance Fund to use its profits brought forward to a larger extent in order to cover deficit. It will also establish the possibility to recover the cost of treatment of people without health insurance. In addition, the procedural deadlines for granting family benefits, identifying the degree of severity of disabilities and granting state pensions will be extended to 30 working days from next year.<\/p>\n

An amendment made to the Bill during the second reading provides that no payment of visit fee may be required in the case that outpatient specialised medical care is provided in connection with pregnancy or childbirth. The Income Tax Act will also be amended so that the sickness benefits paid by the employer and the Estonian Health Insurance Fund as well as the calculated benefits paid to sole proprietors would be subject to income tax.<\/p>\n

Riina Solman<\/strong> and Priit Sibul<\/strong> from Isamaa Parliamentary Group and Lauri Laats<\/strong> from the Centre Party Group took the floor during the debate.<\/p>\n

Isamaa Parliamentary group and the Centre Party Group moved to suspend the second reading of the Bill, but the plenary did not support the motion. Nine members of the Riigikogu supported suspension of the deliberation and 44 were against it.<\/p>\n

The Bill on Amendments to the Social Welfare Act (pensioner\u2019s allowance)<\/strong> (508 SE<\/a>), initiated by the Government, also passed the second reading. According to it, the pensioner\u2019s living alone allowance will no longer be paid to old-age pensioners who are receiving a 24-hour care service, that is, the general care service, the 24-hour special care service, or the community living service.<\/p>\n

From 1 July last year, the municipality of the person according to the population register covers the cost of care in 24-hour general care service in part or in full. The pensioner must pay their food and accommodation costs and other personal expenses. People who receive the 24-hour special care service and community living service also pay for their accommodation and catering costs and the state pays for the service relating to care.<\/p>\n

The explanatory memorandum states that, as pensioners no longer pay the costs of living in care home to a full extent, the payment of the pensioner’s allowance to people living in general care homes and special care homes and receiving the community living service will be terminated from 2025. Around seven per cent of people who are receiving pensioner\u2019s allowance are receiving care service. It is expected that, in 2025, there will be approximately 6,700 pensioners in nursing homes to whom the pensioner\u2019s allowance will no longer be paid.<\/p>\n

The allowance for a pensioner living alone is paid to a pensioner of old-age pension age living alone whose income is below the allowance payment rate which is EUR 853 this year.<\/p>\n

Lauri Laats<\/strong> from the Centre Party Group and Riina Solman<\/strong> from Isamaa Parliamentary Group took the floor during the debate.<\/p>\n

The Centre Party Group and Isamaa Parliamentary Group moved to suspend the second reading of the Bill, but the motion was not supported. Eight members of the Riigikogu supported suspension but 43 were against.<\/p>\n

The sitting ended at 3.22 a.m.<\/em><\/p>\n

Verbatim record of the sitting (in Estonian)<\/em><\/a><\/p>\n

Video recording will be available to watch later on the Riigikogu <\/em>YouTube channel<\/em><\/a>.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

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