The Chamber's 2024 Achievements Help Companies Save Over €50 Million Annually
The Chamber reviewed over 5,000 pages of legal materials related to legislation last year and submitted 202 written opinions to government institutions on draft laws and amendments to existing legal acts. In the process, we achieved several significant victories that save businesses more than €50 million annually.
Tax-Free Limits Increased
At the Chamber's suggestion, as of January 1, 2025, the tax-free limit for daily allowances for foreign business trips increased from €50 to €75 for the first 15 days of the trip and from €32 to €40 for each subsequent day.
Additionally, at the Chamber's suggestion, the tax-free limit for reimbursement for using a personal vehicle for work purposes increased this year from €0.30 to €0.50 per kilometer, but not exceeding €550 (previously €335) per month. As a result of this change, businesses’ tax burden will decrease by up to €1.5 million annually.
From January 1, 2025, at the Chamber’s suggestion, the list of health promotion expenses under the €400 annual tax-free limit now includes costs directly related to massage. Additionally, dental care and dietary counseling services provided by certified nutritionists are tax-free within the same limit. This change will reduce businesses’ tax burden by up to €0.5 million annually.
Audit and Review Thresholds Increased by 25%
On January 17, 2024, at the Chamber's suggestion, the mandatory thresholds for audits and reviews based on assets and sales revenue increased by 25%. The new thresholds apply retroactively to financial periods starting January 1, 2024, and the reports compiled for these periods. As a result of the change, approximately 600 companies are exempted from review obligations, and more than 500 companies will replace audit obligations with review obligations. Raising the thresholds will reduce businesses’ costs by about €2 million annually.
Achievements Related to Motor Vehicle and Security Taxes
At the Chamber's suggestion, the motor vehicle tax law incorporated the principle that the age of the vehicle reduces the annual tax and the one-time registration fee payable for vehicles owned by legal entities. In the initial draft of the law, this principle applied only to vehicles owned by private individuals.
The security tax law included a clarification that, in the case of consolidated financial statements, the basis for the tax should be the unconsolidated profit statement of the parent company. This clarification ensures legal clarity and prevents double taxation on the profit of the parent company.
No Packaging or Sugary Drink Taxes
In March 2024, the Ministry of Climate introduced a waste reform that included a proposal to impose a packaging tax. The Chamber, together with other business organizations, strongly opposed the imposition of the packaging tax, as such a tax does not exist in other member states, and environmental goals are already met through other previously agreed measures. In October 2024, the ministry announced that it would not proceed with the idea of introducing a packaging tax, which was expected to increase state revenue by about €20 million annually.
In the spring of 2024, the Chamber, together with several industry associations (the Estonian Food Industry Association, the Estonian Traders Association, the Estonian Soft Drinks Manufacturers Association), approached various ministries with a proposal to abandon the sugary drink tax, which was expected to generate about €25 million in tax revenue. Although one goal of the tax was to improve public health, there was no convincing evidence that it would achieve this goal. The Parliament took the business organizations' input into account and abandoned the sugary drink tax in the fall of 2024.
Additionally, the government did not proceed with plans to impose an additional regulatory fee on telecommunications companies to provide extra funding for the Consumer Protection and Technical Regulatory Authority. The Chamber strongly opposed the introduction of this new fee.
Alcohol Excise Duty Will Not Increase on July 1, 2025
The Ministry of Finance intended to increase excise rates on gasoline, alcohol, and tobacco products by 5% from July 1, 2025. The Chamber proposed canceling the planned excise increases for July 1, 2025, as the impacts of the changes had not been thoroughly analyzed. The government partially accepted our proposal, canceling the planned alcohol excise increase for July 1, 2025.
Two Wins Related to Foreign Labor
The Chamber opposed an amendment to the Aliens Act that would allow a foreigner to work short-term in Estonia only with a long-term visa. The Ministry of the Interior considered our position and excluded this provision from the draft law. Additionally, we did not support the amendment requiring an employer to have prior (at least six months) economic activity in Estonia as a general rule before hiring a foreigner. The ministry abandoned the requirement that employers must have operated for six months before registering a foreigner for short-term work.
The Ministry of Social Affairs Dropped a Labor Law Amendment at the Chamber's Request
Initially, the Ministry of Social Affairs proposed amending the Employment Contracts Act so that an employment contract could be terminated in the event of reduced work ability due to health conditions only if the employee had been unable to perform their work duties for six months. Under the current law, an employment contract can be terminated if the health condition prevents the employee from performing their duties for four months. The Chamber suggested abandoning the amendment, as six months is a very long period for an employer to accommodate an employee unable to perform their work duties. The ministry took the Chamber's proposal into account, and the planned amendment did not become law.
Several Chamber Proposals Included in the Whistleblower Protection Act
On September 1, 2024, the Act on the Protection of Whistleblowers Reporting Violations of European Union Law (commonly known as the Whistleblower Protection Act) came into force. Its purpose is to protect whistleblowers reporting workplace violations. Several Chamber proposals were included in the law. Initially, the only permitted reporting channels were email addresses, phone numbers, physical mailboxes, or face-to-face meetings. At the Chamber's suggestion, the wording of the law was made more flexible, and now reporting channels may include web platforms or other applications. The Chamber also proposed a provision allowing companies within the same corporate group to share or jointly manage an internal reporting channel, which was included in the law.
Consumer Disputes Committee Decisions Will Not Be Binding
In February 2024, the Ministry of Economic Affairs and Communications prepared a draft amendment to the Consumer Protection Act, proposing that Consumer Disputes Committee decisions be made binding, allowing enforcement through a bailiff. The Chamber opposed making the committee’s decisions binding, as this could conflict with the Constitution and would not solve the problem of non-compliance with decisions. The ministry dropped the proposal to make the Consumer Disputes Committee decisions binding.
Business Register Can Now Be Updated on Specific Dates
On March 1, 2024, an amendment to the Business Register Act came into force, allowing legal entities to request registry entries to be made on a specific date for a valid reason (e.g., due to a merger). Initially, the draft law stated that if the requested date fell on a weekend or public holiday, the entry would be made on the next working day. However, at the Chamber’s suggestion, this was changed so that the entry can also be made on a weekend or public holiday.
No Specific Target Set for Sales Packaging
Initially, as part of the waste reform, the Ministry of Climate wanted to set specific collection or recycling targets for sales packaging. However, at the Chamber's and other business organizations' suggestion, the ministry abandoned this idea. Since it is impossible to sufficiently differentiate sales packaging from the collected packaging waste flow, it is not feasible to reliably determine what proportion of sales packaging has been collected or recycled.
Capital Requirement for Debt Collection Agencies Halved in Law on Credit Collection Agencies and Buyers
In July 2024, the law on credit collection agencies and buyers came into force, regulating the activities of debt collection companies and their related entities. During the drafting of the law, the Chamber made several proposals, some of which were included in the law. For example, the initial draft stipulated that the share capital of a credit collection agency must be at least €50,000. At the Chamber’s suggestion, this amount was reduced to €25,000.
If you have further questions about the Chamber’s 2024 achievements, please contact the Chamber’s lawyers at juristid@koda.ee.