Land tax to go up for many in 2026
Preliminary land tax forecasts from the Land Board brought bad news for many property owners, as expected rates may rise significantly in some areas.
Since last week, every landowner in Estonia has been able to view their preliminary 2026 land tax forecast in the Tax and Customs Board's (MTA) online services portal. Many have been surprised to find that the estimated tax amount is several times higher than what they've paid in the past.
For example, a property in Tartu County that incurred a land tax of €5.50 this year is projected to be taxed €10.85 next year. While the sums may seem small, that represents a 97 percent increase.
Andri Küüts, media relations specialist at the MTA, told ERR that the land tax forecast is currently based on data available in national registers.
"We emphasize that the forecasted amount may differ from the final land tax due. We will calculate the final tax liability and issue tax notices in February next year," Küüts said.
How much the land tax rises will depend on the property's location. Starting next year, each local government can set its own annual increase cap for land tax, ranging from 10 to 100 percent. However, the total amount may never exceed the product of the land's taxable value and the applicable tax rate.
According to a decision by Tallinn's city government this spring, the capital will apply the minimum annual increase cap of 10 percent in 2026. In total, 51 of Estonia's 79 municipalities have opted for this lowest possible rate.
The 10-percent cap also applies in cities such as Haapsalu, Keila, Pärnu and Rakvere, and in municipalities including Lääneranna, Otepää, Kose, Vormsi, Viimsi, Viljandi, Antsla, Elva and many others.
In Tartu, the cap is set at 50 percent. The city has previously stated that it aims to gradually increase land tax revenue so that it reaches €11 million by 2028.
A 50-percent cap is also in place in Loksa, Narva-Jõesuu, Sillamäe and Tartu, as well as in Haljala, Raasiku, Saku and Saue municipalities. In Kohila Municipality, the cap is 60 percent.
Kohtla-Järve is the only local government in Estonia to have adopted the maximum possible annual increase cap of 100 percent. The city council approved the decision in August, noting that it allows but does not require the land tax to double in a single year.
Local governments also decide the homeowner tax exemption amount, which can be up to €1,000. More than 20 municipalities have opted for the maximum exemption, including cities like Tallinn, Narva, Haapsalu and Keila. In contrast, the exemption is €500 in Tartu, €300 in Rakvere, €600 in Pärnu, €200 in Viljandi and Kohtla-Järve and €60 in Võru.
Among rural municipalities, the maximum exemption also applies in places like Harku, Jõelähtme, Kose, Kiili, Lääne-Harju, Muhu, Saaremaa, Rõuge and Väike-Maarja.
Two municipalities — Rae in Harju County and Räpina in Põlva County — have chosen not to offer a homeowner exemption at all. This means no tax break is applied for residents who own their homes in these areas.
Some municipalities also offer land tax exemptions for pensioners. The largest such exemption — €1,000 — is available in Tartu and Maardu. Tallinn, however, does not provide any pensioner exemption. In some regions, exemptions also apply to individuals who were politically repressed.
Next year, around 21,000 landowners will receive a tax notice for the first time. Previously, if the tax amount was under €5, no notice was issued.
Land taxation is based on land value, which reflects data from the 2022 nationwide land valuation.
According to preliminary data from the Tax and Customs Board, 375,000 people are liable to pay land tax this year. Final amounts are expected to be announced by mid-February.
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Editor: Karin Koppel, Marcus Turovski
