VAT-related measures announced by Finland’s Orpo government in its 2026 budget proposal:
Key VAT Reforms
- Reduced VAT Rate on Essentials: The standard reduced VAT rate of 14% will be lowered to 13.5% for select goods and services. This is aimed at boosting household purchasing power and easing inflationary pressure.
- Public Broadcasting VAT Increase: The VAT rate on public broadcasting services will be increased, contributing to higher tax revenues. This aligns with broader fiscal consolidation goals.
- Expanded VAT Base: Several tax deductions and exemptions will be removed to tighten the VAT base:
- Elimination of tax-free status for employee bicycle benefits (for new agreements post-spring 2025).
- Removal of deductibility for trade union membership fees and home office expenses.
- Digital Services Levy: A new levy on subscription-based streaming services will be introduced, functioning similarly to VAT. Revenues will be earmarked for supporting domestic film and TV production.
- Environmental Adjustments: VAT-related support for mining electricity use will be abolished starting January 2026, aligning with sustainability goals.
Sources
Latest Posts in "Finland"
- VAT Treatment of Security Phone Rental and Monitoring Services: Independent or Combined Offerings?
- VAT Exemption for Parking Rights Transfer Within Same Tax Group: Advance Ruling 2025-2026
- Finland advances ‘report once’ digital reporting initiative
- VAT Deduction Rights for Tram Project Planning Costs Regardless of Construction Phase Progression
- Finland’s 2026 Budget: Lower Commodity Tax, Higher Tobacco and Broadcasting Taxes
