Corporation tax receipts to help Finnish local government respond to Covid-19

5 Jun 20

Local governments in Finland are set to be given a higher share of corporation tax receipts than usual, to help them to continue to provide services amid the Covid-19 crisis.


Municipalities’ share of the revenue will be 42.13% this year, if the government’s latest supplementary budget proposal is approved, compared with the normal level of 32.13% – with central government’s share falling in kind.

This will boost their budgets by €520m altogether, of which €410m will be paid this year and the rest to follow in subsequent years.

The extra money is part of a €1.4bn package of proposals to help Finnish local governments.

“All municipalities are different, and the impact of the crisis also varies from one municipality to another,” the Finance Ministry said.

“There are also considerable differences in the current financial positions of municipalities. With this in mind, the support package for municipalities is made up of a variety of different measures.”

The package includes €550m of transfers for basic public services, €112m for services involving children, young people and families, and €60m for ensuring that older people can continue to live their lives to as high a standard as possible.

One-third of the grants for basic services will be allocated to municipalities based on their populations, with the rest based on the levels of corporation tax already apportioned to them in this year’s budget.

The latest supplementary budget proposals also include €200m for hospital districts, to offset costs incurred in preparing for the pandemic and treating Covid-19 patients.

Finland has had nearly 7,000 confirmed cases of the virus, with 322 people dying.


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