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Concepts and definitions

Net tax ratio

The net tax ratio is obtained by deducting income transfers received by the private sector from general government and this is proportioned to the GDP for the same period.

In this context, income transfers include

• public transfers like social security benefits and subsidies,
• investment grants and other capital transfers,
• subsidies on products and other public subsidies such as import, energy and agricultural subsidies.

Social security contributions

Social security contributions (OECD Classification of Taxes heading 2000) covers all compulsory payments that confer an entitlement to receive a (contingent) future social benefit. These include a) employers' social security contributions, e.g. unemployment insurance and old-age insurance premia paid by employers, b) employees' social security contributions, e.g. unemployment insurance and old-age insurance premia paid by employees, employees' contributions to the National Pension Insurance scheme and to the National Health Insurance scheme, c) social security contributions paid by independent entrepreneurs and non-employed persons, e.g. old-age insurance premia paid by entrepreneurs.

The OECD Classification of Taxes heading "Social security contributions" covers only statutory social security contributions, and does not include voluntary social security (a sub-heading under D.611 "Actual social contributions" in the national accounts).

Tax ratio

The tax ratio describes accrued taxes relative to the GDP for the same period.

Taxes and other levies

In OECD statistics, taxes and other levies include compulsory, unrequited payments to general government, including compulsory social security contributions and customs duties, sugar levies and levies on agricultural goods collected by the member states on behalf of the European Union.

Taxes on goods and services

Taxes on goods and services (OECD Classification of Taxes heading 5000) covers all taxes and duties levied on the production, extraction, sale, transfer, leasing or delivery of goods, and the rendering of services, or in respect of the use of goods or permission to use goods or to perform activities. E.g. value added tax, excise duties on alcoholic beverages, motorcar tax, vehicle tax, waste tax.

"VAT own resources" collected from EU member states are shown as a tax of the EU member states in the OECD tax statistics. In the national accounts, these amounts are shown as a tax of the European Union.

Taxes on payroll and workforce

Taxes on payroll and workforce (OECD Classification of Taxes heading 3000) covers taxes paid either as a proportion of payroll or as a fixed amount per person, and which do not confer entitlement to social benefits. Not in use in Finland at the present time.

Taxes on property

Taxes on property (OECD Classification of Taxes heading 4000) covers recurrent and non-recurrent taxes on the use, ownership or transfer of property. These include taxes on immovable property or net wealth, taxes on the change of ownership of property through inheritance or gift and taxes on financial and capital transactions; e.g. the inheritance and gift tax, the asset transfer tax, and the immovable property tax.