The opposition has been consistently trying to steer the discussion on the tax hump towards how the winners of that tax reform will be the rich — some even refer to them as the super-rich. But let us take a look at the facts: How Estonian employees' salaries are distributed, and who will actually be affected by the imminent change.

For those earning the average salary, the tax change will bring the equivalent of a 13th monthly paycheck.

I have also made a chart showing how much more money people will keep annually thanks to the tax reform. The biggest gain comes in the salary range of around €2,100 per month [gross] — up to that point the tax hump currently applies, reducing the tax-free minimum in increments from €1,200 to zero across 6,000 steps. Interestingly, €2,100 is also almost exactly the current average salary in Estonia (according to Statistics Estonia, €2,126 in the second quarter of 2025).

Looking at the net gains — that is, how large of a share the added amount represents of a person's monthly salary — the greatest benefit consequently comes right at the average salary level, to as much as 11.7 percent. In other words, someone earning that €2,100 will henceforth receive in a year the equivalent of an extra 13th paycheck, and even more. With higher incomes, the additional amount is the same, just that its relative share of the total salary falls as earnings rise.

The benefit actually starts from as early on as a gross salary of €655 [per month], although with the lower income brackets this is primarily due to the increase in the tax-free minimum.

According to Statistics Estonia, the average wage of the bottom 10 percent of workers (the first decile) in the second quarter of 2025 came to €817. This means that even among the lowest-income earners, there will already be beneficiaries.

Assuming as a conservative estimate that half in this group will benefit, then all higher salary levels will benefit fully — over 90 percent of Estonia's employees as a whole, or about 540,000 people, will see a higher sum hitting their bank accounts next year than they had before.

A noticeably stronger effect will start at the €1,200 mark, where the additional sum starts rising rapidly.

The average salary in the third decile is €1,219, meaning at least 70 percent of workers (around 415,000 people) will already get a meaningful boost of over €10 per month (or around €120 annually).

The maximum gain from the income tax reform comes at around a monthly gross wage of €2,000–€2,100. About 40 percent of Estonian wage earners — roughly 250,000 people — earn in that range. The biggest relative benefit of the reform goes to middle-income earners: Teachers, rescue workers, police officers, medical staff and some skilled workers are among these. So it is impossible to claim in any way that removing the tax hump serves the interests of the (super)rich — quite the opposite in fact. The facts clearly show that the removal of the tax hump is targeted at the average working person, not the wealthier classes.

And here comes one practical tip: If you have ever submitted a request to your employer to not apply the tax-free minimum for you, it is worth reviewing that before the new year. Submit a new request in December such that the tax-free minimum will be applied again starting January 1. Otherwise, you would have to wait a whole year to get your extra money from the abolition of the tax hump back.

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