In early March, the Finnish Government announced it would abandon its plan to increase the value-added tax (VAT) on confectionery and chocolate.
Finnish Food and Drink Industries’ Federation (ETL) welcomes Government’s decision, as it removes uncertainty for the domestic food industry. It enables investments in industry growth and, consequently, the expansion of food exports.
– I am pleased that the critical feedback during the consultation process, particularly regarding the EU legal and practical issues of the proposal, convinced policymakers to reassess their decision, says Mikko Käkelä, CEO of ETL.
The draft government proposal prepared by the Ministry of Finance would have raised the VAT on confectionery and chocolate to the general VAT rate. This would have led to unequal tax treatment of competing products and unfairly distorted competition between companies. As such, the proposal would have been incompatible with EU law.
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