On 29 December 2022, the Finnish government has published its law proposal (HE 320/2022 vp) for the introduction of windfall taxes on the profits of electricity and fossil fuel companies.
Under the proposal, the tax would be 30 percent of the net profits of power sector companies that exceed a 10 percent return on capital in the tax year 2023. Finnish corporate income tax is 20%, hence the total nominal tax rate would be 50% on net profits made under the defined windfall tax.
The temporary law is expected to come into effect in early 2023 and the tax will be due in early 2024.
