Finland Temporarily Zero-Rates Passenger Transport Services

December 7, 2022

The Finnish Government has announced a temporary application of the zero-rate to domestic passenger transport. This transport is currently subject to the 10% reduced rate. 

‚ÄćTimeline

The temporary reduction will apply from January 1, 2023 through April 31, 2023.

‚ÄćThe new rates

All passenger transport services in Finland will be included, such as train, bus, taxi, plane, and ship transport. Advance payments also fall within the scope. The proposal aims to improve the purchasing power of households during a period of extreme inflation.

Only domestic transport will be impacted by this change, as cross-border transport is already subject to the zero-rate. In addition, the proposal does not affect the passenger transport operator’s right to input VAT deduction.

Companies must be ready to update their systems to maintain compliance with the new rate. 

‚ÄćHow Fonoa can help

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Eszter Kovacs
Tax Researcher

Eszter is a Budapest-based Tax Researcher at Fonoa. Previous to her time at Fonoa, she worked as an Associate at the tax law practice group of Baker McKenzie Hungary. Eszter joined Fonoa because she recognizes that the world of taxation is moving towards digitalization, and sees this company as a clear industry leader in that regard.