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Published: 1 March 2006

Tax ratio up slightly in 2005

According to preliminary data calculated by Statistics Finland, the ratio of the taxes and compulsory social security contributions collected by general government to gross domestic product was 44.5 per cent in 2005. One year earlier, the ratio was 0.2 percentage points lower. The total accrual of taxes and compulsory social security contributions went up by 4.1 per cent from the previous year and was EUR 69.0 billion. The net tax ratio, i.e. the tax ratio less current and capital transfers and subsidies received by the private sector, went up by 0.5 percentage points to 22.1 per cent.

The tax revenue of the state increased by 3.4 per cent from the previous year. Strengthened consumption and investment demand put revenue from value-added tax up by 5.1 per cent to EUR 13.7 billion. Municipalities' tax revenue grew faster than the state's, or by 4.0 per cent. Several revisions were made to the basis for collecting income tax in 2005, e.g. the system of avoir fiscal was abandoned in the taxation of dividends, and the corporate income tax and capital gains tax rates were lowered. The total combined tax revenue of the state and municipalities went up by 3.7 per cent.

The collected amount of compulsory social security contributions was 5.3 per cent higher than in the year before. Their total accrual went up to EUR 18.8 billion.

Finnish National Accounts time series for 1975-2004 will become revised on 31 March 2006. At the same time, the time series of these Statistics on Taxes and Tax-like Payments will also be revised for the 1975-2004 period. After this, the data on 2005 published here will no longer be fully comparable with those on earlier years. Calculations concerning 2005 made in accordance with the time series revision will be published on 13 July 2006.

Taxes and compulsory social security contributions by receiving sector

	1998	1999	2000	2001	2002	2003	2004*	2005*
	EUR million
Total	53,950	56,159	62,418	62,334	64,186	64,187	66,345	69,047
State	28,488	29,577	34,310	32,928	34,667	34,824	36,038	37,277
- Income and property tax	9,752	10,036	13,973	12,098	12,676	11,806	12,319	12,749
- Value-added tax	9,700	10,137	10,869	11,118	11,680	12,455	13,021	13,689
Municipalities	11,767	12,193	13,484	13,807	13,773	13,538	13,778	14,328
Social security funds	13,542	14,246	14,486	15,473	15,640	15,721	16,399	17,292
European Union	153	142	139	127	106	104	130	150
	Relative to GDP, %
Total	46.0	46.4	47.7	45.7	45.6	44.6	44.3	44.5
State	24.3	24.5	26.2	24.1	24.6	24.2	24.1	24.0
- Income and property tax	8.3	8.3	10.7	8.9	9.0	8.2	8.2	8.2
- Value-added tax	8.3	8.4	8.3	8.1	8.3	8.7	8.7	8.8
Municipalities	10.0	10.1	10.3	10.1	9.8	9.4	9.2	9.2
Social security funds	11.5	11.8	11.1	11.3	11.1	10.9	11.0	11.1
European Union	0.1	0.1	0.1	0.1	0.1	0.1	0.1	0.1

* = Preliminary data.

Source: Taxes and tax-like payments 2005. Statistics Finland

Inquiries: Mr Mika Sainio +358 9 1734 2686, skt.95@stat.fi

Director in charge: Mr Ari Tyrkkö

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Last updated 1.3.2006