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Good news for the Estonian maritime sector: less bureaucracy, 0% personal income tax for some seafarers

“We have to restore the merchant fleet and bring the sailors back under our flag, ” Minister of Economic Affairs and Infrastructure Kadri Simson said as a set of bills on regulation of seafaring activities was adopted in the parliament.

The new bill introduces a 0% personal income tax rate for seafarers working on a qualifying vessel. With the special regime, Estonian seafarers are also guaranteed funded pension contributions. Furthermore, all Estonian seafarers will be given the opportunity to receive health insurance through a voluntary agreement.

There are about 10,000 active seafarers in Estonia, about half of whom sail under the flag of a foreign country. Reducing bureaucracy and simplifying requirements in joining the Estonian register will contribute towards bringing ships back under the Estonian flag and will develop the maritime sector.

“The government decided to create a special tax treatment for the shipping industry. The vessels will bring income to Estonia through the collection of registry fees and tonnage tax scheme. This is accompanied by an onshore sector with high growth potential. The companies in the sector will contribute towards creating jobs, which in turn promote the Estonian economy,” said Minister Simson.

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