Proposal to reduce corporate tax and extend period for deducting business losses

The Government is proposing that the corporate income tax rate be reduced from 20 to 18 per cent and the period for deducting business losses be extended to 25 years. The aim is to improve operating conditions for businesses and encourage investments and entrepreneurship. The Government submitted its proposal to Parliament on 3 September.

Tax proposal expected to stimulate economic growth over the long term

According to the proposal, the corporate tax rate would be lowered to 18 percent from the current 20 per cent. The two percentage point reduction proposed by the Government would place Finland’s corporate tax rate below the EU and OECD average, which would boost the international competitiveness of Finnish companies. 

Extension of period for deducting business losses would be a boon to new and growing companies

The period for deducting business losses would be extended from the current 10 years to 25 years. This longer period for making deductions would particularly benefit investments in fields in which new products take years of development and testing before commercialisation. It would also encourage companies to expand their operations.

Legislation to take effect at the beginning of 2027

The proposal relates to the budget proposal for 2027. The proposed acts are planned to enter into force at the start of 2027.

Inquiries:
Antti Sinkman, Senior Specialist, tel. +358 295 530 817, antti.sinkman (at)gov.fi