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Simson: We are taking the first step in restoring the Estonian merchant fleet


Today, at the sitting of the Parliament of Estonia a package of bills to bring ships under the Estonian flag will be at the third reading. This is the first step in restoring the Estonian merchant fleet and bringing three hundred large cargo ships to the Estonian ship register in the next seven years.

According to Kadri Simson, The Minister of Economic Affairs and Infrastructure, the package that reaches the third reading in the Parliament is irreplaceable in increasing the competitiveness of Estonian shipping sector. “The reputation of Estonia as a maritime country was hit hard a few years ago, in 2014, when our last large cargo vessel left the Estonian flag. Now we have to restore the merchant fleet and bring the sailors back under our flag, ”Simson said.

The 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.

“Unfortunately, the Estonian state has not paid much attention to the maritime sector in recent decades. This is a serious misstep, because the potential of this sector is great, especially when considering the onshore sector. I am sincerely glad that we are moving forward with this initiative,” concluded Kadri Simson.