Increasing the non-taxable minimum will help 50% of the population

The state will spend 82 million euros to increase the average salary by 30 euros per monthA photo: Andre M. Chang

The tax-free minimum will be raised from 2023. This will increase the income of half of the inhabitants of Estonia, calculated in the Ministry of Finance. But an average of 30 euros per month.

After the new year, when the tax-free minimum rises from 500 to 654 euros, the amount of free money will increase for 56% of income earners in Estonia, Chancellor of the Ministry of Finance Evelin Liivamägi said in the program Actual Camera.

Now, with a salary of 1200 euros or less, the amount of 500 euros is not subject to income tax. Accordingly, with a salary of 1,200 euros, an employee receives 1,060 euros. When the tax-free share rises to 654 euros, with the same salary, 1,090.8 euros will be handed out.

It must be remembered that with an increase in wages (and, therefore, annual income), the non-taxable minimum decreases. And it becomes equal to zero with a salary of more than 2100 euros. Also, the total income includes pension, salary received abroad, dividends.

“People with incomes between 654 and 1,200 euros will benefit the most, that is, those who can use their tax-free income in full,” said Liivamägi (quoted by ERR).

82million euros in income tax will not receive the budget of Estonia in 2023 due to the increase in the non-taxable minimum

According to the Ministry of Finance, the income of low-paid workers will increase by almost 400 euros per year. There are almost 370,000 such people, including pensioners.


Source: https://www.dv.ee/ by www.dv.ee.

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