Analytics, Employment, Estonia, Financial Services, Legislation, Taxation

The parties agreed that income tax free minimum will increase by 10 euros to 154 euros a month; the unemployment insurance tax rate will be cut from 3% to 2.4% and income tax will fall by 1% to 20% starting next year.

"The new coalition will reduce labour taxes so that employees and companies will keep more than 100 million euros extra next year," said prime minister's candidate Taavi Rõivas.

Estonian finance minister Jürgen Ligi said that the new coalition will preserve structural balance of the budget. He pointed out more effective and flexible financial management, faster increase of excise taxes of alcohol and tobacco and replacing tax concessions of specially marked fuel partly with subsides, that are better directed, as sources for the tax easing. "Also extra income from expanding Eesti Loto advertising rights, measures for reducing tax fraud and fight against the illegal market," Ligi listed the sources.

After the discussion over the policy issues is completed, the two parties will start talks about distribution of seats in the government.