Finland: Ministry of Finance publishes its Budget proposal for 2013 – detailsAugust 15, 2012
On 8 August 2012, the Ministry of Finance published its Budget proposal for 2013. Details of the proposed tax measures are summarized as follows:
- Introducing a tax incentive for R&D costs
- Doubling the depreciation rates for some industrial investments
- Introducing a general limitation on the deductibility of interest expenses
- Introducing a special deduction for training and education costs
- Suspending the automatic adjustments made annually to the tax brackets. No adjustments will be made between the tax years 2013 and 2014.
- Introducing a new tax bracket for earned income above €100,000. Tax on the amount would be €18,719 and the rate on excess, 31.75%.
- Introducing surtax on large pensions.
- Increasing the credit granted to low- and medium-income earners for national income tax purposes and the basic allowance for municipal tax purposes.
- Limiting the maximum exempt compensation for using a personal car for work-related travel.
- Limiting the deductibility of voluntary pension insurance premiums and contributions to qualifying long-term savings schemes by increasing the age limit, after which the beneficiary may at the earliest receive the benefits, to 68 years (currently 63 years).
- Continuing to decrease the deductible portion of mortgage interest to 80% in tax year 2013.
- Introducing two temporary tax incentives for individuals investing in non-listed growth companies:
- Under the one, a taxpayer would receive a tax credit
- Under the other, the taxpayer would be entitled to use a maximum presumed acquisition cost of 50% (normally 20% and 40% for assets held for 10 years or longer) of the sale price
- Introducing, temporarily, a new tax bracket on inheritance and gifts exceeding €1m for inheritance and gift tax purposes.
- Abolishing the gift tax exemption for payment of a maximum of €8,500 insurance capital.
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