Parliament rejects Centre Party proposal to reduce food VAT again

Parliament did not support the Centre Party's bill, which aimed to reduce the VAT on basic foodstuffs from 24% to 13%. This is not the first time such an initiative has failed to gain support in parliament.

Parliament voted against a draft law submitted by the Centre Party last night, which would have reduced VAT on basic foodstuffs from 24 per cent to 13 per cent. The proposal failed to garner sufficient support in parliament and was rejected.

The Centre Party has repeatedly raised the issue of food taxation, emphasizing that the high VAT disproportionately affects lower-income families. According to the party, a lower tax rate would help alleviate the pressure of rising living costs on ordinary household budgets.

Opponents have emphasized that reducing VAT would result in significant revenue loss for the state budget, which is unacceptable given the current fiscal situation. Coalition parties have so far remained firmly committed to maintaining a uniform VAT rate on basic foodstuffs.

The rejection of the bill in Parliament means that food in Estonia will continue to be subject to the general 24 per cent VAT rate. The Centre Party may reintroduce its proposal in the future should the political climate change.