Analytics, Estonia, Financial Services, Legislation, Markets and Companies, Taxation

The measures would increase the administrative and tax burdens of law-abiding entrepreneurs instead of targeting fraudsters, six organizations including the Estonian Chamber of Commerce and Industry and the Estonian Employers Confederation said in an e-mailed statement on Friday, October 18th.

Estonia has struggled in recent years to cut VAT fraud while keeping a business-friendly tax system. The tax office will start collecting data on domestic sales and purchase transactions exceeding 1,000 euros via entrepreneurs' monthly tax receipts, while VAT deductions on car purchases will be limited by half and can't exceed 2,000 euros, according to plans unveiled by the ministry last month. The interest-free deadline on VAT refunds would also be extended by half to 60 days.

As eported, the tax revenue collected by the state budget amounted to 413.1 million euros in September, which is an increase of 1.3% as compared to the same time last year, as the data of the Finance Ministry of Estonia showed.

The main reason for the modest increase was fall of collection of VAT and corporate income tax year-on-year.

In the first nine months of the year, the year-on-year growth of tax collection was 6.7% to 3.79 billion euros.

75.4% of the amount planned for the state budget this year has been collected in nine months. Corporate income tax has exceeded forecasts most since in nine months, 106.5% of annual plan has been collected.