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Tax cuts and budget surplus Estonia's Reform Party wants to lower unemployment insurance and income taxes, establish a ceiling for the social tax and abolish the fringe-benefits tax on job-related training.

- The changes will spur creation of new jobs and will be carried out when budget opportunities arise, says the party's leader and Estonia's Prime Minister Andrus Ansip.

Estonia aims for an overall budget deficit of 1,3% of the GDP this year, compared with 1,7% last year and PM Ansip's Reform Party has set a goal to reach a budget surplus by 2013.

The government froze income-tax reductions in 2008 when Estonia entered the recession and it stands at 21% against the Reform Party's goal of 18%. The unemployment insurance-tax rate rose more than fourfold to 4,2% in 2009 to meet the budget-deficit terms for euro entry.

Estonia's social tax should remain at 33% according to the Reform Party's plans though it is by employers regarded as a key obstacle for foreign companies to create high-paying jobs in Estonia.

The Reform Party move marks the start of the coming campaign in connection with Estonia's election to Riigikogu (the Parliament) March 6th next year.

According to a TNS Emor survey, the Reform Party's support reached a three-year high of 41% in October. That was a widening of its lead over the main opposition, Edgar Savisaar's Center Party who saw its support ease to 24%. The Reform Party's coalition partner Isamaa ja Res Publica Liit was preferred by 16% of those polled in TNS Emor's survey.