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Employers’ group wants higher buying power through tax cuts
The Confederation of Finnish Industries (EK) has come out sharply against a centralised incomes agreement this year.
“We will be part of a solution that supports corporate competitiveness and wage-earner purchasing power”, says EK managing director Mikko Pukkinen.
He says that both of these goals can be achieved through moderate pay agreements with individual unions, and with individual employers, after which the government would cut income taxes and corporate taxes.
“Instead of large pay hikes we need lighter taxation of incomes. If the goal is to secure Finland’s international competitiveness and the purchasing power of its wage earners, this solution could be a very sensible one.”
Pukkinen does not want to set a level for income taxes, but he feels that corporate taxes should be reduced from the current 26 per cent to 20 per cent. The government policy programme promises to cut the corporate tax rate by one percentage point.
He notes that Finland can afford tax cuts if they are used to boost competitiveness in a way that enhances employment.
“Finland is doing fairly well economically, and decisions made by the government need to direct our economy toward the future over a period of at least three years.”
Pukkinen calls on the government to prepare for taxation decisions soon.
“Our starting point is that the government needs to have a sensible economic and taxation policy in any event. These matters cannot be linked in such a way that the government can only make significant decisions on taxation if something happens at the negotiating table. These are quite separate matters.”
Pukkinen emphasises that although his organisation does not want a centralised contract, Finnish employers are conscious of their responsibility.
“We believe that if society manages to secure the international competitiveness of companies, it will be the engine that will make the economy work, and which can guarantee jobs and services for people.”
The EK welcomes tripartite cooperation involving the central labour market organisations and the government on issues such as labour legislation and social issues.