Payroll on Bloomberg Tax is built to get you to the right answer faster and more efficiently. Get all the payroll intelligence you need with Bloomberg Tax expert analysis, perspectives and...
Sept. 22—A proposed 2017 budget that would decrease employer social tax contributions, increase most employee social tax contributions and provide small individual income tax breaks was submitted to parliament Sept. 15 by the Finnish cabinet.
The budget, expected to take effect Jan. 1, 2017, formally proposes many of the items contained in the draft 2017 budget issued Aug. 12, 2015.
Under the proposed budget, employer social security contributions would decrease to 1.06 percent of salaries and wages from 2.12 percent.
Employer unemployment insurance contributions would decrease for the small businesses to 0.8 percent from 1 percent. For larger business, or those with payroll amounts greater than 2,044,500 euros ($2.29 million) a year, the employer contribution rate would decrease to 3.3 percent form 3.9 percent.
Employer pension fund contributions would decrease to 17.95 percent from 18.1 percent.
The employee health insurance contributions would decrease to 0.06 percent of salaries and wages from 1.3 percent in the proposed budget but other social tax rates would increase under the proposed legislation.
The daily allowance would increase to 1.54 percent from 0.82 percent while the pension contributions would increase to 6.15 percent from 5.7 percent and unemployment insurance would increase to 1.6 percent from 1.15 percent.
The proposed budget would increase all income tax bracket thresholds by a small amount while decreasing both the highest and lowest income tax brackets by 0.25 percentage points.
Under the proposed income tax changes:
•The first income tax bracket's threshold would increase to 16,900 euros ($18,970) from 16,700 euros ($18,746) while the rate would decrease to 6.25 percent from 6.5 percent.
• The second income tax bracket's threshold would increase to 25,300 euros ($28,400) from 25,000 euros ($28,062) while maintaining a 17.5 percent tax rate.
• The third income tax bracket's threshold would increase to 41,200 euros ($46,247) from 40,800 euros ($45,798) while maintaining a 21.5 percent tax rate.
• The fourth and highest income tax bracket's threshold would increase to 73,100 euros ($82,055) from 72,300 euros ($81,157) while the rate would decrease to 31.5 percent form 31.75 percent.
Now subject to parliamentary approval, a Finnish Finance Ministry official told Bloomberg BNA that it “is highly likely that the proposed amendments are adopted by mid-December and then submitted to the president for ratification.”
To contact the reporter on this story: Jared Mondschein at email@example.com
To contact the editor responsible for this story: Michael Trimarchi at firstname.lastname@example.org
The budget documents are available in Finnish at valtioneuvosto.fi/budjetti-2017
More information on payroll issues in Finland can be found in the Finland country primer.
Copyright © 2016 The Bureau of National Affairs, Inc. All Rights Reserved.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to email@example.com.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to firstname.lastname@example.org.
Put me on standing order
Notify me when new releases are available (no standing order will be created)