92 Bureaucratic Requirements Less

Recently, the Government of the Republic has approved the two-year report of the Zero Bureaucracy Task Force, which reveals that the state has realised 92 proposals made by entrepreneurs for decreasing bureaucracy. See more on, which bureaucratic requirements have been abolished and which proposals are still being worked on.

• Submission of an application for compensating the social tax on employees with special needs. Within the framework of the Zero Bureaucracy project, the Chamber highlighted the problem that if an employer has hired a person with special needs and wants that the state would pay the social tax on that person, the employer has to send the respective application to the state on a monthly basis. This problem was solved from 1 July 2016 and by now employers are no longer required to submit the application for the social tax on a monthly basis, instead, a single application is sufficient.

• Digital building permit process. In 2015, we informed the state that the process of application for the building permit is too bureaucratic and it takes an unreasonable amount of time for the local municipality to issue the permit. In April 2016, the Building Register module was implemented, allowing digital processing of the building permits. Such change will allow speeding up of the process of issuing most building permits. Additionally, the state has said that there are plans to develop the Building Register further to speed the processes up even more.

• Statistics reports. The Chamber emphasised the need to decrease the administrative burden on entrepreneurs in relation to filling in and submitting statistics reports. By now we can see several positive changes. For example, since the second quarter of 2016, the statistical report “Vacancies and Labour Movement” is pre-filled with the data from the Employment Register.

• Driving logs. When an employer’s passenger car is used for private purposes, there is no more requirement to fill our driving logs.

• Limit for the parties liable to value added tax. The limit for the parties liable to value added tax was increased from 16,000 euros to 40,000 euros from the beginning of the year 2018.

• Auditing of packaging reports. Based on the proposal made by the Chamber, businesses that place on market less than 5 tons of packaging mass are exempt from the obligation to audit the packaging reports since 1 January 2016.

• More flexible hiring of foreign employees. Three proposals made by the Chamber in relation to hiring persons from third countries have been realised. For example, we proposed that if a company hires a person from a foreign country, the police is no longer required to informed of the hiring, because the police will get the necessary information from the Employment Register. This proposal was realised in 2016. In January 2017, the amendment abolishing the requirement of 183-day stay in Estonia entered into force. While previously, a foreign investor was required to apply for the registration of his or her absence if he or she was outside Estonia for more than 183 days, from the Police and Border Guard Board, this obligation has been abolished by now. Additionally, the process of applying for residence permits by major investors has been simplified.

More than 70 proposals for decreasing bureaucracy are still being worked on. These proposals are related to major developments and their realisation will take time. For example, the Tax and Customs Board and Statistics Estonia have initiated a project called Reporting 3.0 the aim of which is to decrease the load of submitting data to the authorities and make the submission of data automatic. In the first stage, sending of salary and labour data will become automatic, thereafter other areas will be taken on. Furthermore, the Tax and Customs Board is planning to review all applications for assigning taxes and make them simple and user-friendly for taxpayers within the framework of the project Tax Collection 2020.

The object of the severest criticism given to the various reporting environments by the employees has been eSTAT. Statistics Estonia has promised that in the coming years, the convenience of use of eSTAT will be increased. Additionally, wording and guidelines of the reports will be made more understandable.

In the coming years, the state is planning several important simplifications in the field of occupational health and safety area. Hopefully, the Parliament will pass the respective draft in 2018. There is a plan to simplify the requirements related to the area of the environment also with the second development phase of the environmental decisions information system KOTKAS, which should be ready in 2019.

While initially, the focus of the Zero Bureaucracy project was only on realising the proposals made by entrepreneurs, the project has been expanded by now. The aim is to simplify the requirements related to application for permits for economic activities. Additionally, the aim is to use a uniform methodology for assessing administrative burden, which would be based on standard cost model.

In 2015, the state started the Zero Bureaucracy project within the framework of which entrepreneurs and their representative organisations submitted 252 proposals for decreasing administrative burden. The state promised to abolish 164 bureaucratic requirements or 65 percent of all the submitted proposals. The Chamber submitted 62 proposals for decreasing bureaucracy based on the proposals received from the members.

See the report of the Zero Bureaucracy Task Force (in Estonian):