Finland's Ministry of Finance released its draft 2027 budget on 6 August 2026, proposing a corporate income tax cut from 20% to 18% alongside a VAT increase to 14% and a new 13.5% intermediate rate.
Finland’s Ministry of Finance announced the draft budget for 2027 on 6 August 2026, which includes several significant corporate tax measures.
The government will review the draft budget during its budget session on 1–2 September, after which the Ministry of Finance will finalise the proposal. The finalised budget will be considered by the Extraordinary Committee on Finance and the Government plenary session before being published on 21 September. The Parliament is expected to approve the 2027 State Budget in December 2026.
Corporate income tax
Among the key proposals is a reduction in the corporate income tax rate from 20% to 18%, effective from 2027. The draft budget also proposes an exemption from the interest deduction limitation rules for infrastructure projects deemed critical to security of supply, a measure expected to reduce tax revenues. It further includes a reduction in the carbon dioxide tax component on transport fuels and a cut to the basic vehicle tax.
Personal income tax
Low- and middle-income earners get EUR 230 million in direct relief plus EUR 640 million from progressive index adjustments. Stock option taxation for unlisted firms shifts from exercise to disposal. Household deductions rise temporarily, but the pension savings tax credit will be removed from 1 January 2027.
VAT
The reduced rate climbs from 10% to 14%, with a new intermediate rate of 13.5% set to take effect in 2027, the final stage of a path set in motion in 2025. Small businesses catch a break as the tax-free registration threshold rises to EUR 20,000, even as lower-limit relief is scrapped.
Real estate tax
Transfer tax rates hold steady at 3% for real estate and 1.5% for shares. Welfare areas keep their exemption through 31 December 2030, and taxation of additional considerations is delayed.
Excise duties
Tobacco tax rises in two steps through 2027. Alcohol gets both automatic indexation and a discretionary hike stacked together. The carbon component in fuel taxes drops (EUR 42 million), data centres lose preferential electricity rates from mid-2026, and the mining mineral tax jumps from EUR 13 million to EUR 71 million.
