Finland\u2019s finance ministry has proposed a \u20ac92.2 billion state budget for 2027, leaving a \u20ac12.9 billion deficit despite stronger growth and higher tax revenue.<\/p>\n
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Finance Minister Riikka Purra presented the plan on Tuesday after internal budget talks in Espoo. The proposal will form the basis of the government\u2019s negotiations on 1 and 2 September.<\/p>\n
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The state expects revenue of \u20ac79.4 billion before borrowing.<\/p>\n
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Purra said no new spending cuts were planned beyond \u20ac4.8 billion in measures already approved by Prime Minister Petteri Orpo\u2019s government.<\/p>\n
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\u201cAn austere savings programme will continue,\u201d she said.<\/p>\n
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State interest costs are expected to rise to \u20ac4.3 billion next year, up \u20ac1.1 billion from 2026.<\/p>\n
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Automatic index increases will add about \u20ac1.2 billion to spending.<\/p>\n
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The proposal also includes tax cuts agreed earlier. Corporate tax will fall from 20 per cent to 18 per cent, while earned income tax will fall across all wage groups.<\/p>\n
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Purra said the largest reductions would apply to people earning about \u20ac20,000 to \u20ac56,000 a year.<\/p>\n
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The overall tax rate is expected to decline from 42.7 per cent in 2023 to 42.2 per cent in 2027.<\/p>\n
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Purra said growth would raise tax revenue but would not create room for new public spending.<\/p>\n
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\u201cThe state\u2019s finances are in such chronically poor condition that even this kind of economic growth does not change them in a meaningful way,\u201d she said.<\/p>\n
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High unemployment, care costs, defence spending and debt interest remain the main pressures on the budget.<\/p>\n
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Purra said Finland would stay on the spending path set by the European Commission under the excessive deficit procedure.<\/p>\n
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She also said the next government should prepare adjustment measures worth about \u20ac10 billion during the following parliamentary term.<\/p>\n
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Opposition parties criticised the proposal.<\/p>\n
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Centre Party deputy chair Markus Lohi said it failed to stop the rise in state debt.<\/p>\n
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Left Alliance chair Minja Koskela attacked the corporate tax cut and said the plan lacked measures to reduce unemployment.<\/p>\n
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The Central Organisation of Finnish Trade Unions, SAK, also called for more action on unemployment and long-term joblessness.<\/p>\n
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The full finance ministry proposal is due to be published on Thursday before the government finalises the budget in September.<\/p>\n
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