President Toomas Hendrik Ilves has approved a bill which will force companies to declare any transactions over 1,000 euros. He vetoed a similar bill in December.

“Apparent conflicts with the Constitution have been removed and the analysis of its effect has been improved,” Ilves said today.

He said only time will tell whether the new law will have any effect on tax fraud or not.

Ilves said there is a suspicion and a feeling of superiority among politicians toward businesses, but the business community should be encouraged and acknowledged instead.

Ilves was voted the "taxpayer's friend" after his veto in 2013, and Finance Minister Jürgen Ligi the "taxpayer's foe" for proposing the idea. Ligi said the requirement would cut tax fraud, while business unions said it burdens companies with unnecessary red tape.

"Such an intensive restriction on basic rights can only be seen as constitutional if analysis of the various types and examples of VAT fraud can prove that current schemes to hide revenue and to defraud the state of VAT would, in the conditions of the regulation, become either impossible or significantly easier to discover, and that they cannot quickly be replaced with new effective fraud schemes," the President said in December.

IRL, now in opposition, calculated the additional cost to businesses at 80 million a year, with possible extra revenue only 30 million euros.