- Finland plans to reduce the reduced VAT rate to 13.5% starting in 2026
- The proposal is part of measures to support economic growth and reduce the tax burden on low and middle-income earners
- The General Government Fiscal Plan for 2026-2029 includes reducing work taxation by EUR 1 billion and lowering the corporate tax rate to 18%
- Defense spending will increase by EUR 3.6 billion by 2029, with improved resources for internal security
- The reduced VAT rate applies mainly to food and medicine, decreasing government revenue by approximately EUR 145 million
- Lower VAT may lead to competitive advantages for businesses due to reduced product prices
- This would be the second VAT rate change in two years, following an increase in the standard VAT rate in 2024
- Final decision pending, and legislative procedures must be completed before implementation
Source: vatabout.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
