Amidst rising defense costs, Estonia is contemplating the introduction of a security tax in the coming years. Finance Minister Mart Vorklaev announced this potential measure in response to a proposal from Estonian Defence Forces’ chief Martin Herem. General Herem suggested increasing defense spending to 5% of GDP, enabling the purchase of €1.5 billion worth of ammunition to deter or neutralize Russian threats.
While Minister Vorklaev acknowledged the necessity of a broad-based security tax, he emphasized that it would not be implemented until 2026. This proposal has drawn mixed reactions. Center Party parliamentary faction member Vadim Belobrovtsev expressed skepticism about the availability of €1.5 billion, urging authorities to prioritize economic recovery.
Last year, Estonia’s GDP declined by 3%, highlighting economic challenges. The government has previously agreed to increase defense spending to 3% of GDP between 2024 and 2027, building upon the NATO threshold of 2%. Estonia’s proximity to Russia, sharing a border of 284 kilometers, has heightened concerns about potential threats.
Since the onset of the Ukraine conflict in 2022, Estonia, along with Latvia and Lithuania, has been a focal point in the Western confrontation with Russia. Senior officials from NATO member states have alleged that Russia may plan an attack on the bloc. However, Russia has repeatedly denied these claims, with President Vladimir Putin asserting that the country has no geopolitical, economic, or military interest in engaging in a conflict with NATO.
