Global Daily Tax News, Estonian Tax Agency Highlights 2026 Tax Changes, (Dec 2, 2025)

Estonia's Tax and Customs Board has released an overview of tax changes for 2026, including key rates and thresholds.

The guidance incorporates changes to the tax regime from the Act on Amendments to the Simplified Taxation of Business Income Act and the Income Tax Act and on the Repeal of the Security Tax Act and the Income Tax Act – Bill 734 SE; and the Act on Amendments to the Social Welfare Act and Other Acts – Bill 732 SE.

Among other things, the guidance notes the new EUR700 monthly income tax-exempt allowance and the retained personal tax rate of 22 percent. Previously, the Government had proposed raising corporate and personal income tax rates by two percentage points to 24 percent but withdrew the measure.

The guidance also notes an expansion of the scope of the deduction for spending on training, and for gifts and donations from October 1, 2025; the increase to the value-added tax rate to 24 percent; and the 10 percent increase to excise duties on tobacco and alcohol, among other changes.