The Finnish Government announced the 2025 Budget on 3 September 2024. This release outlines several tax policy decisions that align with the draft budget proposals introduced by the Ministry of Finance in August 2024.

The government is moving forward with plans for a tax credit to accelerate large-scale industrial investments that support the clean energy transition, as agreed in the spring session on spending limits. The scope of the tax credit will be as broad as possible, within the boundaries set by the EU’s Temporary Crisis and Transition Framework and the government’s spending limits. This initiative aims to increase electricity-powered industrial investments and support the growth of a clean transition industry in Finland. The goal is to implement this tax subsidy by 1 January 2025, or sooner if possible.

The conditions for  labour migration will be improved by amending the Income Tax Act to extend the tax exemption on employer-covered relocation costs.

The standard VAT rate and the tax rate on certain insurance premiums will be increased from 24% to 25.5%, effective 1 September 2024. Additionally, the minimum VAT threshold for small businesses will be raised from EUR 15,000 to EUR 20,000. The value-added tax rate for compensation received by the Finnish Broadcasting Company from the State Television and Radio Fund is still being discussed by the parliamentary working group for the Finnish Broadcasting Company.

The taxation of rental income in agriculture will be restructured. The excise duty on soft drinks and spirits will be increased effective 1 November 2024, while the excise duty on tobacco products will be raised on 1 July 2025. Additionally, the tax incentive for zero-emission company cars will be extended until 2029.

The tax incentive for zero-emission company cars will be extended until 2029. Starting in 2026, the vehicle tax on electric vehicles and plug-in hybrids, as well as the propelling force tax on camper vans, will be increased, with tax revenue expected to rise as early as 2025.

The Government will discuss the 2025 budget proposal in its plenary session on 23 September.  The Economic Survey by the Ministry of Finance will be published in connection with the budget proposal on 23 September 2024.