Tax statistics show surge in capital gains income last year

MedOne owners get windfall from medical outsourcing

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Those with the highest incomes in Finland also received record-high dividends, sales profits, and other returns on capital gains. According to last year’s tax information, which was made public this week, the last hurrah of the economic boom meant that the top 1,000 earners of capital income got more money than at any time in the decade.
      Average capital income earnings for the top 1,000 was EUR 1,921,181 each, which is 27 per cent more than in 2006. However, earned income declined from the previous year, which is attributable to weaker stock option programmes. One reason behind this was a decline in stock market prices in late 2007.
     
The outsourcing of municipal services proved to be a source of massive profits for the founders of the medical services provider MedOne.
      Taxation information for 2007 indicates that MedOne CEO Pertti Karjalainen collected EUR 22 million when MedOne was sold to Sweden.
      Together, the owners of MedOne got a total of EUR 52 million in capital gains.
      Established in 2000, MedOne runs 60 public health clinics, service homes for the elderly, and care wards. In addition, the company provides doctors on a temp basis to municipal health clinics suffering from a shortage of labour.
     
Also earning considerable profits by providing legally mandated services were the managers of the inspection, testing, measurement and certification services provider Inspecta Corporation, formerly the State Technical Inspection Centre.
      For instance, the company’s former CEO Simo Hassi got EUR 3.1 million in earnings, and an equal amount in capital gains income when Inspecta was sold to Britain.
     
Making the top of the list in earned income last year once again was Jorma Ollila, chairman of the boards of Nokia and Shell Oil, who made EUR 5.1 million.
      The greatest amount of capital gains income, EUR 58.5 million, was for Tuusula-based inventor Göran Sundholm, who sold his company Marioff to the US company UTC Fire & Security for about EUR 50 million. Established in 1985, Marioff manufactures fire extinguishing systems. It employs more than 350 people in more than ten countries.
     
The proportion of women among the top income earners in Finland grew last year.
      Of the 1,000 top earners last year, 113 were women, which is 23 more than a year earlier. The highest earned income for a woman was paid to Maarit Näkyvä, who tog a total of EUR 2.7 million.
      Topping the women’s list for return on capital was Rafaela Seppälä, one of the main owners of Sanoma Corporation, who got EUR 10.3 million in taxable income.
     
Film producer Markus Selin and music producer Asko Kallonen were among the highest capital income earners through the sales of their companies. Selin sold half of his production company Solar Films to the Danish Nordisk Film. Selin got a combined EUR 1.45 million in earned and capital income.
      Music producer Asko Kallonen, who also served as one of the judges on the Finnish Idols competition, did well by selling his Helsinki Music Company to Warner. This earned him more than EUR 830,000.
     
Corporate executives at the top of the list saw their incomes decline somewhat, which was largely attributable to a declining yield in stock options.
      Mikael Lilius, former CEO of the energy company Fortum, no longer runs the company. However, the Fortum stock option programme brought him EUR 2.1 million, which was nevertheless much less than the EUR 11 million that he made in 2006.

More on this subject:
 Few women among top earners in Finland

Previously in HS International Edition:
  Fortum executives top earnings lists for 2006 (1.11.2007)
  Economic rise also benefited middle-income Finland (2.11.2008)

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