Taxpayers' Association says Finland places heavy taxes on middle income earners

“High taxation a problem in international tax competition”

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With the exception of the very lowest income earners, taxation in Finland is steeper than in other European countries on the average.
      Those with medium incomes pay one percentage point more in income taxes in Finland than in other European countries. The higher the earnings, the greater the difference between Finland and the rest of Europe in income tax rates.
      The difference is even greater if countries outside Europe are included.
      The figures come out in a fresh international comparison in income put out by the Taxpayers' Association of Finland, comparing the taxation of income in 18 Western industrialised countries. The study was conducted by the association’s head economist Jaana Kurjenoja
     
The association has called for a lower marginal tax at all income levels.
      Kurjenoja says that Finland lacks a taxation system that would provide incentives for enterprising people.
      The survey indicates that Finland’s marginal tax rates exceed those of the other countries in the comparison in all income brackets.
      Even in the lowest income bracket, that of cleaners, the marginal tax rate is eight percentage points higher than in the European countries in the comparison, and 17 points higher than the average in the countries outside of Europe.
      Marginal taxation of those with medium incomes is 6.9 per cent higher in Finland than the average for other European countries in the comparison.
     
One of the most interesting observations in Kurjenoja’s view is the contrast between the taxation of medium income earners in Finland and in Sweden.
      Whereas a wage earner without a family in the lowest wage bracket pays about the same in income taxes in Finland and Sweden (about 23 per cent), income taxation in the medium range is clearly lower in Sweden than in Finland.
      Both Finland and Sweden tax the highest income brackets about equally.
      “Taxation of middle-income-earners is higher in Finland than in Sweden. The difference with Sweden has increased in recent years”, Kurjenoja says.
      “In Sweden, purchasing power of the middle class has been increased.”
      According to the Taxpayers’ Association of Finland, the tight taxation of those with middle incomes can bring problems in international tax competition.


Links:
  The Taxpayers´ Association of Finland

Helsingin Sanomat