5FinlandValue Added Taxation in Europe.docx

1、5Finland Value Added Taxation in EuropeFinland - Value Added Taxation in Europe Latest Information 1. Introduction 2. Taxable, Non-Taxable and Exempt Taxable Persons 3. Taxable Transactions 4. Place of Taxable Transactions 5. Chargeable Event, Tax Due, Tax Payable 6. Taxable Amount (Basis of Assessm

2、ent) 7. Rates 8. Exemptions within the Country 9. Exempt Importation/Intra-Community Acquisitions 10. Exemptions of Exports/Intra-Community Supplies and Like Transactions/International Transportation 11. Special Exemptions Linked to Bonded Warehouses, Free Zones and Other Areas 12. Deductions and Re

3、funds 13. Special Regimes 14. Immovable Property (Immovable Goods) 15. Administrative Obligations 16. Powers of the Tax Authorities 17. Appeals Appendix I Registration form Appendix II Periodic VAT return Appendix III European sales listing draft Appendix IV Intrastat returns Appendix V Form to repo

4、rt amendments/closing down of business Finland - Value Added Taxation in EuropeAuthorPivi TaipalusLatest InformationThis chapter is based on information available up to 1 January 2010.See Tax News Service for any later developments. Abbreviations, Terms and References Finnish VAT legislation is cont

5、ained in:VAT Act :The VAT Act (Arvonlisverolaki) of 30 December 1993/1501 with the later amendments by the Act of Changing the VAT Act on 29 December 1994/1486 and on 29 December 1995/1767 and some other changes. VAT Decree :The VAT Decree (Arvonlisveroasetus) of 21 January 1994/50.-Several written

6、guidelines from the National Board of Taxation1.Introduction1.1.GeneralFinland adopted a turnover tax system in 1941. The second Turnover Tax Act was adopted in 1942, the third in 1951, the fourth in 1964 and the fifth in 1991. The fifth Turnover Tax Act, which came into effect on 1 October 1991, in

7、troduced significant reform in the Finnish VAT. The old turnover tax was superseded by a new law similar to the European value added tax system. The Government Bill for Value Added Tax Act was presented to the parliament on 7 June 1993. The content of the law was confirmed on 7 December 1993 by the

8、parliament and the law became effective on 1 June 1994. Due to Finlands membership of the European Union, effective as from 1 January 1995, some changes had to be made in order to conform the legislation to the (E)EC VAT Directives, for example, the rules with regard to intra-Community trade were in

9、troduced and primary production (farming, forestry, fishing, etc.) became taxable. The VAT Act is supported by the VAT Decree and by written guidelines of the National Board of Taxation. According to Art. 1 of the VAT Act (30 December 1993/1501 with the later amendments by the Act of Changing the VA

10、T Act on 29 December 1994/1486), taxable transactions include the following: -supplies of goods and services which take place in Finland as a business activity;-importation of goods into Finland; and-intra-Community acquisitions in Finland.Where the VAT Act refers to “Finland”, it means continental

11、Finland and the territorial waters of Finland. The position of the autonomous land islands is exceptional. The land islands decided to become a part of the European Union together with Finland. However, the land islands are not a part of the European Union for VAT (and excise, etc.) purposes, accord

12、ing to the Treaty of Accession (Protocol No. 2). Consequently, goods from the other Member States have to be cleared through customs and VAT must be paid at importation. When the goods are supplied from the land islands to Member States, this is considered to be a zero-rated export. For trade betwee

13、n continental Finland and the land islands this would have been too complicated. That is why a special law concerning VAT and excise duty treatment between continental Finland and the land islands (29 December 1994/1484) was introduced. According to this law, supplies of goods from the continent of

14、Finland to the land islands and from the land islands to the continent of Finland are considered to be supplies within Finland. However, effective 1 March 1997, the VAT and excise border was established also between the land islands and the mainland of Finland by changing Law 1994/1484. Consequently

15、, the land islands are treated as a third country in respect of VAT and excise duties in relation to the mainland of Finland. Cross-border trade is treated as importation and exportation from a VAT and excise duty point of view. Transportation to the land islands to/from other Member States is treat

16、ed as transportation to/from third countries and therefore zero-rated/exempt. The formalities at the border are simplified in trade between the land islands and the mainland compared to those between Finland and third countries. 1.2.Structure of VAT ActThe Finnish Value Added Tax Act of 1993 (as ame

17、nded by the law 29.12.1994/1486) comprises 23 chapters and 237 articles.The chapters have the following titles: Chapter 1:TerritorialityChapter 2:VAT liabilityChapter 3:Supplies subject to VATChapter 3:Intra-Community acquisitionsChapter 4:Exempted suppliesChapter 5:Supplies and acquisitions deemed

18、to take place in FinlandChapter 6:Exemptions relating to international tradeChapter 7:The basis of VATChapter 8:Tax ratesChapter 9:Importation of goodsChapter 10:DeductionsChapter 11:RepealedChapter 12:Refunds of VAT to other than taxable personsChapter 12a:Special arrangements for electronically su

19、pplied servicesChapter 13:Chargeable eventChapter 13a:Administrative treatment with regard to certain intra-Community transactionsChapter 14:Payment of the taxChapter 14a:Special relief scheme for small entrepreneursChapter 15:Refunds of VAT for certain foreign businessesChapter 16:VAT authoritiesCh

20、apter 17:Obligation to reportChapter 18:RegistrationChapter 19:Assessment of taxChapter 20:Guidance and advance rulingsChapter 21:AppealsChapter 22:Special rulesChapter 23:Implementation and transitional provisions1.3.Administrative organizationVAT is administered by the National Board of Taxation (

21、verohallitus) and by eight regional tax offices (verovirasto). In addition, there is the tax office for large companies (Konserniverokeskus). 1.4.Other indirect taxesSet forth below is a list of other indirect taxes:1.4.1.Excise dutiesExcise duties (valmistevero) are levied, in addition to VAT, on s

22、upplies of the following products: mineral oils, alcoholic beverages, tobacco products, electricity, coal, and natural gas. In addition, national excise duties are levied on soft drinks and beverage packages. Excise duties for mineral oils, alcoholic beverages, tobacco products, electricity, coal an

23、d natural gas are due for those products which are manufactured in Finland, delivered to Finland from other Member States or imported from outside the European Union. The possession of these products in a business form makes the one who possesses them liable to duty in other cases. 1.4.2.Transfer ta

24、xFinland applies a 1.6% transfer tax on shares. Transactions carried out on the stock exchange are exempt from the transfer tax. There is a transfer tax on the transfer of immovable property of 4%. 1.4.3.Registration tax (car tax)A tax is levied on registration of passenger cars, vans and motorcycle

25、s before taking the vehicle into use or before it has been registered into use in Finland. The party liable to tax is the importer, the manufacturer of the vehicle, the transferee if the liability has been transferred, or the person registering the vehicle, the user or the owner of the vehicle. 1.4.

26、4.Motor vehicle taxA tax is levied on motor vehicles which are fuelled by power or fuel other than unmixed gasoline or gasoline based on alcohol. Taxes payable based on the Motor Vehicle Tax Act include a basic tax, an additional tax in certain cases and a tax payable for a car registered abroad and

27、 brought to Finland for temporary use. 1.4.5.Insurance premium taxAn insurance premium tax of 22% is levied on insurance premiums where the associated risk is in Finland, except for certain specified exemptions. 1.5.Source materialLaws, rulings and guidelines, etc., used as sources for this chapter,

28、 are listed under Abbreviations, terms and references. 2.Taxable, Non-Taxable and Exempt Taxable Persons2.1.Taxable persons2.1.1.General/definitionThe person liable to tax is the person who supplies goods or services subject to VAT as a business activity within Finland, imports goods into Finland or

29、 makes intra-Community acquisitions in Finland with certain exceptions. Taxable persons can be individuals, enterprises, non-profitable organizations, foreigners and public bodies.2.1.1.1.Foreign taxable personsForeigners are liable to tax if they supply taxable goods or taxable services from a fixe

30、d establishment within Finland. Foreign businesses can also become liable for payment of the tax without having a fixed establishment in Finland, for example when making supplies to private persons. If the foreign enterprise does not have a fixed establishment, the liability of the tax is, in most c

31、ases, shifted to the recipient of the supply. (For fixed establishment, see 15.2.3.) With regard to refunds of VAT to foreign businesses, see 12.9.1., liability for payment of tax, see 15.2.1. and regarding registration requirements, see 15.2.3.2.1.2.Intra-Community acquisition of new means of transportAn intra-Community acquisition of a new means of transport (see 3.5.1. for a definition) is always taxable in Finland and the person making the acquisition is liable to VAT. If a private person, who does not carry on a business activity which is liable to VAT, purchases a new means of tra