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Published: 1 March 2011

Tax ratio declined in 2010

The tax rate, or the ratio of taxes and compulsory social security contributions to gross domestic product, was 42.2 per cent in 2010. One year before it was 43.1 per cent. The tax ratio fell because tax accruals grew slower than GDP in nominal terms. The tax rate has last been this low in 1987. In 2010, the accruals of taxes and compulsory social security contributions totalled EUR 76.0 billion, which is three per cent more than in the year before. These data are based on the preliminary national accounts data for 2010.

Taxes and compulsory social security contributions by sector, 2009–2010 ¹⁾

Sector	Year	Million euro	Ratio to GDP, %
S13+S212 Total	2009	73 785	43.1
	2010	76 020	42.2
S1311 Central Government	2009	34 061	19.9
	2010	34 878	19.3
S1313 Local Government	2009	17 595	10.3
	2010	18 538	10.3
S1314 Social Security Funds	2009	21 976	12.8
	2010	22 452	12.5
S212 European Union	2009	153	0.1
	2010	152	0.1

1) Preliminary data

The accrual from households’ income tax amounted to EUR 22.3 billion in 2010, being around one per cent less than in the year before. Although the revenue from municipal tax grew by three per cent, the income tax revenue of the state decreased by nine per cent, which lowered the total accrual from households’ income tax. State income tax includes both taxes on earned income and taxes on capital income. In contrast, the corporation tax revenue turned towards brisk growth in 2010. The growth amounted to 30 per cent, in which case around EUR one billion more was accrued from corporation tax than one year earlier.

In 2010 the tax revenue of the state totalled EUR 34.9 billion, which is 2.4 per cent more than in 2009. The tax revenue of municipalities amounted to EUR 18.5 billion, or 5.4 per cent more than one year earlier. Social security funds accrued compulsory social security contributions to the tune of EUR 22.5 billion. Nearly 77 per cent of this were employment pension contributions.

The net tax ratio, which refers to the tax ratio less the subsidies, and current and capital transfers paid by general government to households and enterprises, stood at 17.4 per cent in 2010. In 2009 the net tax ratio was 18.0 per cent.

Source: National Accounts, Statistics Finland

Inquiries: Niina Suutarinen (09) 1734 3302

Director in charge: Ari Tyrkkö

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Updated 1.3.2011