Global Daily Tax News, Finland Confirms Corporate Tax Cut In 2027 Budget, (Aug 7, 2026)

The Finnish Government has tabled its 2027 Budget proposal, confirming the implementation of a previously announced cut to the corporate income tax rate.

The Budget confirms plans to reduce the nation's corporate income tax rate from 20 percent to 18 percent and extend the loss carryforward period for businesses losses to 25 years.

The changes are intended to boost Finland's attractiveness for international investment. The corporate tax rate was already reduced from 26 percent to 20 percent during 2006-2014.

The new corporate tax rate cut responds to declining corporate tax rates internationally, the Finnish Government earlier said, including at EU level, where the average corporate tax rate is now 21.2 percent.

If approved by lawmakers, the corporate tax cut would be effective from the 2027 tax year and would be applied to corporate advance payments after its entry into force. The amendment to the loss deduction rules would apply to losses incurred in or after the tax year 2026.

The Government has also pledged EUR230m to increase the earned income deduction and will increase income tax brackets to account for inflation.

Opportunities for Finnish growth companies to attract skilled labor will be improved by shifting the taxation event for employee stock options, for shares in unlisted companies, from the time of exercise to the time of transfer of the underlying asset, and the entrepreneur's deduction will be increased.

Tax revenues will be increased, among other things, by increasing alcohol and tobacco taxes.