The Finnish Ministry of Finance published its draft budget for 2027 on 6 August 2026. The document sets total expenditure at EUR 92.2 billion against projected revenues of EUR 79.4 billion, leaving a deficit of EUR 12.9 billion. That deficit is EUR 0.5 billion smaller than the estimated 2026 outturn.
Corporate tax rate
The headline tax measure is a reduction in the corporate income tax rate from 20% to 18%, taking effect from 2027. The two-percentage-point cut is framed as a business competitiveness measure. The detailed press release issued by Minister of Finance Riikka Purra describes it as part of a broader effort to improve business incentives.
The draft also introduces an exemption from Finland's interest deduction restriction rules for critical infrastructure projects. The English-language press materials do not elaborate on the precise scope of the exemption, and the full detail remains in the Finnish-language budget documentation.
Other tax changes
Several further measures affect individuals and growth companies. The earned income deduction will increase by EUR 230 million, and earned income tax bases will receive an index adjustment at all income levels. For unlisted companies, the taxation trigger for employee stock options shifts from the date of exercise to the date of transfer of the underlying asset. The entrepreneur deduction is also increased. On the revenue side, alcohol and tobacco taxes will rise.
Legislative timetable
The draft budget is the minister's own proposal and does not yet represent Government policy. The Government will negotiate the final budget at a session on 1 and 2 September 2026. The Ministry of Finance will then finalise the Government's budget proposal, which will be published on 21 September. Parliament is expected to adopt the budget in December 2026.
The Ministry of Finance's economic forecasts put GDP growth at 0.8% in 2026 and 1.6% in 2027. The general government deficit is projected at 4.4% of GDP in 2026, rising to 4.6% in 2027.