Commerce creates work and tax revenue – tax policy has not supported growth as hoped

Commerce employs around 280,000 people in Finland. Among under-25-year-olds in working life, as many as one in five earn their livelihoods in the commerce sector. Commerce serves society extensively: it is involved in everyday life and the economy, from healthcare and construction procurements to the needs of industry and consumers. In this way, the sector supports the well-being of Finland as a whole.

The VAT revenue of commerce grows slower than the VAT revenue of the entire economy

In 2024, the VAT revenue generated by commerce was approximately EUR 10.5 billion, which was nearly half (49.1 per cent) of the total VAT revenue in Finland. However, the VAT revenue charged by commerce grew slower than the total VAT revenue: by July 2025, the cumulative VAT revenue of commerce was 3.4 per cent higher than in the previous year, when the corresponding growth of the entire economy was 5.3 per cent.

The VAT increase that entered into force in September 2025 made consumers more cautious, and it has had a particularly large effect on the specialty goods trade, which is already in a challenging situation. According to the government’s budget reports, the VAT revenue forecast has had to be reduced twice during the current year, by a total of EUR 700 million.

“The tax increase is not reflected in the tax revenue as the government has expected, as it has weakened purchasing power and also directed consumption to e-commerce outside the EU,” explains Jaana Kurjenoja, Chief Economist of the Finnish Commerce Federation.

Commerce is one of the largest funders of public finances

In 2024, the income tax revenue paid by commerce for private sectors was the third largest, EUR 2.4 billion.

Commerce is also one of the largest sectors as a payer of corporate taxes. In 2024, of all sectors, commerce paid the third highest amount of corporate taxes in Finland – a total of EUR 831 million. The financial and insurance sectors paid the most corporate taxes.

The reduction in income taxation for all income levels, which will enter into force at the beginning of 2026, will improve the purchasing power of Finns and support the turnaround in the growth of domestic commerce.

“The general economic outlook has also improved moderately. Inflation has slowed down and interest rates are falling, which will make the situation easier for households. Consumer confidence remains cautious, but it is likely to strengthen as purchasing power gradually improves,” says Kurjenoja.

Further information: Jaana Kurjenoja, Chief Economist, tel. +358 40 820 5378, jaana.kurjenoja(at)kauppa.fi