Finnish Tax 2026: Key Changes
Taxes remain the primary source of government revenue. According to the government’s consolidated updated budget dated December 19, 2025, total state revenues for 2026 are estimated at EUR 81.6 billion (excluding net borrowing). Taxes and similar levies make up the vast majority of this income, accounting for EUR 68.2 billion, or 84% of the total. Overall, budget revenues are expected to rise by 6.4% (EUR 4.9 billion), with tax receipts specifically projected to grow by 1.5% (about EUR 1 billion) compared to the original 2025 budget.
Taxation of earned income. Payroll taxation
Ansiotulojen verotus. Palkansaajan verotus
In 2026, changes in employee taxation will depend not only on income level, age, and the number of dependent children, but also on factors such as the amount paid in labor union membership fees or the use of the home office deduction related to remote work.
- General Trend: Income taxes will decrease overall, particularly for low- and middle-income earners due to an increased "earned income tax allowance."
- High Earners: The top marginal tax rate will be cut to about 52%. Previously, this rate could be as high as 59% for those earning slightly less than €100,000 per year and above. Estimates of the change in marginal tax rates for employees, 2025–2026
- Age 53–62: Net income will rise significantly as the extra pension contribution for this age group is removed. Estimated changes in the tax rate for employees aged 53–62, 2025–2026
- Offsetting Factors: Higher unemployment insurance contributions (+0.3 percentage points) and other changes in social insurance contributions will partly reduce the benefit of the tax cuts.
Read more:
- Social insurance contributions. Sosiaalivakuutusmaksut VERO.FI
IN DETAIL: Estimation of the changes in payroll taxation, 2025-2026
| Salary 2025, euros / month |
Annual income 2025, euros |
Taxes 2025, euros / year |
Tax rate 2025,% |
Tax rate 2026,% |
Change in tax rate, % - points |
Easing (-)/Increasing (+) EUR / year |
| 1 600 |
20 000 |
2 175 |
10.9 % |
11,0 % |
0,1 % |
+20 |
| 2 000 |
25 000 |
3 884 |
15,5 % |
15,6 % |
0,1 % |
+30 |
| 2 400 |
30 000 |
5 987 |
20,0 % |
19,7 % |
-0,3 % |
-90 |
| 2 800 |
35 000 |
7 867 |
22,5 % |
22,0 % |
-0,5 % |
-180 |
| 3 000 |
37 500 |
9 028 |
24,1 % |
23,6 % |
-0,5 % |
-190 |
| 3 200 |
40 000 |
10 218 |
25,5 % |
25,1 % |
-0,4 % |
-160 |
| 3 600 |
45 000 |
12 614 |
28,0 % |
27,7 % |
-0,3 % |
-140 |
| 4 000 |
50 000 |
15 057 |
30,1 % |
30,0 % |
-0,1 % |
-50 |
| 4 500 |
56 250 |
18 107 |
32,2 % |
32,1 % |
-0,1 % |
-60 |
| 5 000 |
62 500 |
21 318 |
34,1 % |
34,1 % |
0,0 % |
0 |
| 6 000 |
75 000 |
27 846 |
37,1 % |
37,1 % |
0,0 % |
0 |
| 7 000 |
87 500 |
34 374 |
39,3 % |
39,3 % |
0,0 % |
0 |
| 8 000 |
100 000 |
41 094 |
41,1 % |
40,9 % |
-0,2 % |
-200 |
| 9 000 |
112 500 |
48 508 |
43,1 % |
42,2 % |
-0,9 % |
-1010 |
| 10 000 |
125 000 |
55 922 |
44,7 % |
43,2 % |
-1,5 % |
-1880 |
| 11 000 |
137 500 |
62 914 |
45,8 % |
44,0 % |
-1,8 % |
-2480 |
| 12 000 |
150 000 |
69 898 |
46,6 % |
44,7 % |
-1,9 % |
-2850 |
| 15 000 |
187 500 |
91 366 |
48,7 % |
46,2 % |
-2,5 % |
-4690 |
| 20 000 |
250 000 |
127 715 |
51,1 % |
47,8 % |
-3,3 % |
-8250 |
Child increment to the earned income tax credit increases
Työtulovähennyksen lapsikorotus
The child increment to the earned income tax credit will rise by €55, to €105 per dependent child. For single parents, the increment is granted at double the amount. As this credit is deducted directly from taxes, the €55 increase translates to an extra €55 in annual net take-home pay.
Tax deductibility of union fees will be abolished
Työmarkkinajärjestöjen jäsenmaksujen verovähennysoikeus
Membership fees for labor market organizations will become non-deductible for both employees and employers. However, payments to unemployment funds remain tax-deductible. Impact of the abolition of union fee tax deductions on taxes payable in 2026.
Home office deduction abolished
Työhuonevähennys palkkatuloista
Going forward, actual expenses for working from a home or free-time residence will no longer be tax-deductible as costs for acquiring or maintaining wage income.
Tax exemption for company bicycles to be abolished
Työsuhdepolkupyörien verovapaus
The benefit is taxable for all new agreements made on or after April 24, 2025. Agreements made before this date remain tax-exempt until the contract ends (max. 5 years).
Employer-paid legal advice
Työnantajan kustantama oikeudellinen neuvonta
Legal advice paid for by the employer will be tax-exempt if it concerns matters arising from the employee's work duties.
Tax-at-source scheme for key employees arriving in Finland
Suomeen tulevien avainhenkilöiden lähdevero
The flat tax-at-source rate for key employees will drop from 32% to 25% starting in 2026. The scheme will also be extended to returning Finnish citizens.
Fringe Benefits
Luontoisedut
The car charging benefit will no longer be tax-exempt as of 1 January 2026. This change applies to charging a private vehicle or a limited car benefit (käyttöetu) car at the workplace or at public charging stations. The ruling applies to both fully electric cars and plug-in hybrids, establishing a distinct taxable value for each.
The Tax Administration’s decision on fringe benefits has also confirmed the values for other common benefits, such as housing, company cars, meals, and telephone benefits. The maximum limit for the meal benefit will increase from €13.70 to €14.00 for the year 2026.
Kilometre allowances and per diems
Kilometrikorvaukset ja päivärahat
Check the links for the tax-exempt kilometre allowances, domestic per diems, and foreign per diems confirmed by the Tax Administration for 2026.
Read more:
- Finnish Travel Allowances 2026. Kilometre allowances and per diems
- Tax-exempt allowances in 2026 for business travel. The maximum per diems payable for business travel outside Finland VERO.FI
Pensioner taxation and additional tax on pension income
Eläkkeensaajan verotus ja eläketulon lisävero
Government tax reforms primarily target earned income, with fewer changes to pension taxation. In 2026, index adjustments will increase employment pensions by 0.88% and national pensions by 0.47%.
The reductions in the highest marginal tax rates also apply to pension income. Simultaneously, the additional pension tax threshold will rise from €47,000 to €60,000. This easing serves to offset proposed changes in the state income tax scale; without this adjustment, pension taxation would increase significantly in many cases.
Overall, most pensioners will not see major changes to their taxation. However, for those earning €70,000–€100,000 annually, taxes are set to increase despite the easing of the additional pension tax. Meanwhile, those with incomes exceeding €100,000 will benefit from the marginal tax cuts, resulting in a lighter tax burden for the highest pension levels.
Pensioners who also have employment income may see tax reductions even at lower levels due to broader labor tax cuts.
IN DETAIL: Estimation of the changes in Pension taxation, 2025-2026
| Pension 2025, euros / month |
Annual income 2025, euros |
Taxes 2025, euros / year |
Tax rate 2025,% |
Tax rate 2026,% |
Change in tax rate, % - points |
Easing (-)/Increasing (+) EUR / year |
| 1 100 |
13 200 |
0 |
0,0 % |
0,0 % |
0,0 % |
0 |
| 1 300 |
15 600 |
768 |
4,9 % |
4,9 % |
0,0 % |
0 |
| 1 500 |
18 000 |
1 812 |
10,1 % |
10,0 % |
-0,1 % |
-20 |
| 1 700 |
20 400 |
2 856 |
14,0 % |
14,0 % |
0,0 % |
0 |
| 1 900 |
22 800 |
3 843 |
16,9 % |
16,8 % |
-0,1 % |
-20 |
| 2 100 |
25 200 |
4 622 |
18,3 % |
18,3 % |
0,0 % |
0 |
| 2 300 |
27 600 |
5 502 |
19,9 % |
19,7 % |
-0,2 % |
-60 |
| 2 500 |
30 000 |
6 497 |
21,7 % |
21,5 % |
-0,2 % |
-60 |
| 2 750 |
33 000 |
7 587 |
23,0 % |
22,9 % |
-0,1 % |
-30 |
| 3 000 |
36 000 |
8 862 |
24,6 % |
24,3 % |
-0,3 % |
-110 |
| 3 500 |
42 000 |
11 777 |
28,0 % |
27,9 % |
-0,1 % |
-40 |
| 4 000 |
48 000 |
14 739 |
30,7 % |
30,9 % |
0,2 % |
+100 |
| 4 500 |
54 000 |
17 683 |
32,7 % |
32,7 % |
0,0 % |
0 |
| 5 000 |
60 000 |
20 697 |
34,5 % |
34,2 % |
-0,3 % |
-180 |
| 6 000 |
72 000 |
26 723 |
37,1 % |
37,5 % |
0,4 % |
+290 |
| 7 000 |
84 000 |
32 749 |
39,0 % |
39,8 % |
0,8 % |
+670 |
| 8 000 |
96 000 |
39 380 |
41,0 % |
41,6 % |
0,6 % |
+580 |
| 9 000 |
108 000 |
46 337 |
42,9 % |
42,9 % |
0,0 % |
0 |
| 10 000 |
120 000 |
53 293 |
44,4 % |
44,0 % |
-0,4 % |
-480 |
| 15 000 |
180 000 |
88 825 |
49,3 % |
47,3 % |
-2,0 % |
-3600 |
Municipal Taxes
Kunnallisverot
In 2026, municipal tax rates will rise in 36 mainland Finnish municipalities and decrease in four. The average rate will increase to 7.57% (+0.04 percentage points from 2025).
Inheritance and Gift Tax Thresholds to Rise
Perintö- ja lahjaveron alarajat
Starting January 1, 2026, the minimum threshold for taxable inheritance will rise from €20,000 to €30,000, and for taxable gifts from €5,000 to €7,500. Additionally, the tax-exempt value of ordinary household effects will be increased from €4,000 to €7,500. Furthermore, the interest rate margin for the ten-year payment period of inheritance tax will be reduced from 3.5% to 2%.
Read more:
- Government proposal to Parliament for acts amending the Inheritance and Gift Tax Act and certain other acts. HE 94/2025, FINLEX
- Higher Tax-Free Limits for Inheritance and Gifts VERO.FI
- Inheritance Tax Calculator
- Gift Tax Calculator
Gasoline and diesel tax cuts
Bensiinin ja dieselin verotaso
Fuel excise taxes will be reduced in two stages: on January 1, 2026, and January 1, 2027. The total impact on consumer prices (including VAT) is estimated at 3 cents/liter for gasoline and 3.3 cents/liter for diesel. The 2026 adjustment will account for roughly half of this, about 1.5 cents/liter.
14% VAT rate to decrease to 13.5%
ALV-kanta alenee
The 14% value-added tax (VAT) rate, which applies to food, restaurant meals, books, medicines, public transport, and accommodation services, will be reduced by 0.5 percentage points starting January 1, 2026.
Online VAT calculator. VAT rates in Finland
Alcohol Excise Duty
Alkoholivero
Starting in 2026, all alcohol tax rates will undergo an index adjustment tied to consumer prices. This link will become permanent, resulting in automatic annual increases based on changes in the cost of living.
Additionally, wines and other fermented beverages will be subject to a separate tax hike effective January 1, 2026. This increase is intended to partially offset the revenue lost by cancelling the planned VAT hike on sweets and chocolate.
Soft Drink Tax
Virvoitusjuomavero
Effective April 1, 2026, a new revenue-neutral tiered system will categorize drinks more precisely based on sugar content. Alongside this structural change, a total tax increase of approximately €110 million will be implemented, as decided in recent government budget sessions.
Tobacco Tax
Tupakkavero
Excise duties on various nicotine products, including cigarettes, nicotine pouches, and e-liquids, will be increased
Electricity Security of Supply Fee
Sähkön huoltovarmuusmaksu
The electricity security of supply fee is set to increase starting April 1, 2026. For a household with an annual consumption of 2,000 kWh, this change will increase electricity costs by approximately €2 per year.
Forestry Deduction
Metsävähennys
The maximum forestry deduction will rise from 60% to 75% of the forest-related capital income for the tax year. This increased deduction will first be available in the 2026 tax return, to be filed in spring 2027.
Read more:
- Forestry Deduction VERO.FI
Share Swaps
Osakevaihdot
In share swaps between related parties, the shares will henceforth be valued at their pre-swap mathematical value when calculating the acquiring company's net assets. Additionally, the acquisition cost for tax purposes will be based on this same mathematical value plus acquisition expenses.
These changes apply to dividends available for withdrawal from January 1, 2026, and affect share swaps carried out on or after January 1, 2017.
Financial Sector Bonuses
Finanssialan bonukset
Starting in 2026, bank bonuses and discounts related to private loans, accounts, or investments will be classified as taxable capital income. This means bonuses from loan contracts can no longer be used for insurance premiums without being taxed. However, benefits remain tax-free if they are used for identical purposes (like loan interest), are not paid out as cash, and offer the customer no unlimited choice of use. This change applies strictly to financial institutions, while bonuses from food supermarkets remain exempt from income tax.
Deduction of Losses
Tappioiden vähentäminen
In the 2025 growth package, the Government agreed to extend the period for deducting tax losses from 10 years to 25 years. This change applies to losses confirmed for the 2026 tax year and onwards.
New Crypto Reporting Requirements
Kryptovarapalveluille uusi tiedonantovelvollisuus
Starting in 2026, the Tax Administration will require more extensive reporting on crypto trading. Service providers must collect data on user identities, purchases, sales, and transfers for both Finnish and non-Finnish users. The first annual returns under these rules must be submitted to the Tax Administration in 2027.
Published 02.01.2026, FINREPO
