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Eurofound's COVID-19 EU PolicyWatch collates information on the responses of government and social partners to the crisis, as well as gathering examples of company practices aimed at mitigating the social and economic impacts.

Factsheet for case EE-2020-12/337 – measures in Estonia

Social tax payments for solo self-employed

FIE-de sotsiaalmaksu avansilised maksed

Country Estonia , applies nationwide
Time period Temporary, 20 March 2020 – 07 May 2020
Type Legislations or other statutory regulations
Category Supporting businesses to stay afloat
– Direct subsidies (full or partial)
Author Ingel Kadarik (Praxis Center for Policy Studies) and Eurofound
Case created 07 April 2020 (updated 15 July 2020)

Background information

Solo self-employed (FIE in Estonia) are obliged to pay social tax four times a year as advance payments at the end of every quarter in the amount of at least the minimum social tax obligation (in 2020, €534.6 per quarter). The final tax liability based on their business income is calculated the next year based on the income tax declaration. As several solo self-employed are in difficult position due to the restrictions, the measure is seen as a soothing measure to avoid tax arrears and economic difficulties for the sole proprietors.

Content of measure

To help the solo self-employed persons, the state pays the social tax advanced payment for the first quarter of 2020 to the solo self-employed's prepaid account in the Tax and Customs Board. It is possible to use the payment for the first quarter payment of the social tax. If the payment for the first quarter has already made by the solo self-employed, the payment can be used for the payment of any tax liability now or in the future, or transfer the money to their bank account and use it for other business costs. The size of the payment is €534.6.

Use of measure

On 7 May 2020 the Tax and Customs Board started making the payments to the self-employed. There were altogether 28,000 self-employed in Estonia at the time, of whom 7,426 had an obligation to pay the quarterly payment. A total of 1,747 of them had not paid the quarterly payment yet, thus it was paid by the Tax and Customs Board in the total amount of €800,000. There were 5,769 persons however who had already paid their tax. For them a total of €2.5 million were paid out and they can choose how to use the money.

Target groups

Workers Businesses Citizens
Does not apply to workers Solo-self-employed
Does not apply to citizens

Actors and funding

Actors Funding
National government
Other social actors (e.g. NGOs)
National funds

Social partners

Social partners' role in designing the measure and form of involvement:

Trade unions Employers' organisations
Role No involvement as case not in social partner domain No involvement as case not in social partner domain
Form Not applicable Not applicable

Social partners' role in the implementation, monitoring and assessment phase:

  • No involvement
  • Main level of involvement: Unknown

Involvement

N.a.

Views and reactions

No information to add.

Sources

  • 20 March 2020: The state supports solo self-employed (Riik toetab FIE-sid sotsiaalmaksu tasumisega) (www.emta.ee)
  • 07 May 2020: Tax Board started with the payments to solo self-employed (MTA alustas FIEde eest esimese kvartali avansilise sotsiaalmaksu tasumist) (www.emta.ee)

Citation

Eurofound (2020), Social tax payments for solo self-employed, case EE-2020-12/337 (measures in Estonia), COVID-19 EU PolicyWatch, Dublin, http://eurofound.link/covid19eupolicywatch

Disclaimer: This information has not been subject to the full Eurofound evaluation, editorial and publication process. All information is preliminary and subject to change.