Budget 0.5% reduction from 14% for reduced rate; no change to 25.5% standard rate
In the mid-year budget discussions, and external finance plan 2026-29, the Finnish government has proposed a 0.5% reduction in VAT from 14% to 13.5%. This would come into effect from 1 January 2026 on food, accommodation, passenger transport and other services (see below).
There will be no change to the 10% reduced rate (newspapers and public broadcasting).
This cut to the 14% rate will benefit foods and a range of supplies:
- food, beverages and food ingredients, spices, chemicals used to stop food from decaying.
- restaurant services
- Books
- accommodation (hotels, motels, hostels, farm stays, camping sites for tents, camper vans or trailers, and cottage rental)
- pharmaceuticals
- sanitary protection products, baby diapers
- supply of sports/fitness service incl. gym, golf and ice rink bookings, and sale of ski lift tickets
- admittance to cultural, entertainment or sports events, such as theatre, circus, fairs, amusement parks, concerts, museums, zoos, cinemas or exhibitions, and live streaming of such events
- passenger transport services (taxi, buses and coaches, trains, flights in Finland)
- fees received by a performing artist, athlete or other public performer, if the recipient is registered for VAT for these activities
On 1 January 2025, many reduced rate supplies were shifted from the 10% rate to the 15% rate.
January 2025 reduced rate recatorgoisation following 2024 standard rate hike
Finland raised VAT to 25.5% in September 2024. And on 1 January 2025 Finland changed reduced VAT rates as follows:
From 10% to 14%
- Books (newspapers, journals or magazines remain at 10%)
- Hotel services
- Public transport
- Pharmaceuticals from 10%
- Entrance to cultural & sporting events
- Film screenings
- Royalties for television and public radio activities
From current 24% to 14%
- Tampons
- Nappies
Read more in our Finland VAT guide
