New minimum gross monthly salary of 320 euros is not yet approved
Minimum gross monthly salary is still 290 euros, until the government approves new minimum with its decree. The Estonian Trade Union Confederation and The Estonian Employers’ Confederation signed an agreement on 21st of December 2012, which stated a new minimum gross monthly salary of 320 euros. Estonian 2013 state budget adopted by parliament states 290 euros minimum salary, which is a base for calculating social tax minimum payment of 95,7 euros for each employee per month. Possible increase of minimum gross salary would also apply to all the minimum salaries paid to the members of the board in Estonia. It is possible to pay lower gross salary, stating part time employment, but the minimum social tax payment will always apply.
Lower unemployment insurance rates for 2013
Unemployment insurance payment is 2% for employees and 1% for employers. Previous rates in force since 1st of August 2009 were 2,8% for employees and 1,4% for employers. Payments from the employees and employers are collected according to The Unemployment Insurance Act to finance unemployment insurance benefits and the work of Estonian Unemployment Insurance Fund. The insurance and the payments do not apply for persons working under board member contracts.
Unchanged labor tax rates
Income tax rate is continuingly flat 21%, annual basic exemption (non-taxable amount) per year is 144 euros per month (1728 euros annually), social tax rate 33% and funded pension tax rate 2%.
To remember when declaring taxes on labor
Salaries for December 2012, which are to be paid out in January 2013, have to comply with new tax rates in force.
