In Estonia, businesses are calling for a reduction in the VAT rate on food, but the government opposes the move — ERR
In Estonia, the business community has called for a reduction in the VAT rate on basic food items due to rising prices, but the government has criticized the initiative.
This was reported by ERR.
An association of merchants and retail chains has launched an information campaign stating that the high VAT rate makes food less affordable, especially for low-income households. They note that prices have risen by approximately 40% over the past four years, and consumers are increasingly opting for discounted items.
Business owners also argue that due to high VAT, the cost of a basic food basket in Estonia is higher than in some other EU countries, and believe that lowering the tax could support both consumers and local producers.
Meanwhile, Finance Minister Jürgen Ligi called the campaign manipulative. According to him, lowering the VAT does not guarantee lower prices and could also lead to budget losses that would have to be offset by other revenues.
The government emphasizes that, given the budget deficit, such measures could complicate the financing of important state programs.
As a reminder, Estonia has demonstrated energy shields for Ukrainian cities.
Estonia also supported the creation of an international commission on reparations for Ukraine.
