Finnish Commerce Federation: The budget session to make decisions to support growth and purchasing power 

The government must focus on accelerating growth and supporting purchasing power in the budget session. Strengthening domestic demand is crucial for strengthening economic growth and employment. At the moment, weak demand is slowing down the recovery of the entire economy.

“Now we must make decisions that will improve private consumption demand and strengthen the willingness of companies to invest. The tax reductions agreed in the spring for wage earners and companies must be maintained, and the solutions that support consumption should be continued,” says Kari Luoto, Managing Director of the Finnish Commerce Federation.

The success of the commerce sector has a broad impact on Finland’s economy. Commerce is the largest employer in the corporate sector, and its impacts extend widely into society. The private service sectors already employ more than half of Finns and account for 52 per cent of the gross value added, i.e. economic well-being, of the national economy.*

“If private consumption does not pick up, economic growth will fall short,” says Luoto.

Business subsidies supporting economic growth and reform should be excluded from the cuts

If the government decides to cut business subsidies, they should be allocated to inefficient business subsidies that maintain old structures. Economic reform subsidies, such as innovation funding aimed at the introduction and commercialisation of innovations, should be excluded from the cuts.

The Finnish Commerce Federation proposes that the cut in innovation funding decided in the budget framework session, which is problematic in terms of economic reform and strengthening the competitiveness of the service sector, should be cancelled.

“In Finland, productivity has not increased in nearly two decades. Innovation funding accelerates economic reform and productivity growth,” Luoto emphasises.

Urgent measures are needed to stop unfair competition in e-commerce

Finland has not taken sufficient measures to ensure equal competitive conditions, even though they are weakened by e-commerce outside the EU.

In connection with the budget session, Finnish Customs, the Finnish Safety and Chemicals Agency Tukes and the Finnish Competition and Consumer Authority should be directed to monitor foreign distance selling more effectively.
“Immediate measures are needed to ensure product safety and equal competitive conditions. Effective monitoring and Finland’s active EU influencing play a key role in ensuring the same rules for all operators,” says Luoto.

The Finnish Commerce Federation also considers national deregulation to be important in order to reduce the administrative burden on companies.

“Overlapping and complex regulations place an unnecessary burden on operators in the commerce sector and weaken competitiveness. The Commission has excelled in the theme. Now, regulation should be streamlined more ambitiously at the national level as well,” says Luoto.

* Source: Preliminary data on the Annual National Accounts 2024

For further information, please contact:

Kari Luoto, Managing Director, Finnish Commerce Federation, tel. +358 (0) 400 688 708, kari.luoto(at)kauppa.fi