Survival of the Richest

Finland
“We must address tax avoidance, tax
crime, aggressive tax planning and money
laundering. We have to act as fast as
possible. We must increase transparency.
We must exchange information. We must
create common registries and establish a
blacklist of countries.”
Alexander Stubb
Former Minister of Finance 340
Overview
Fiscal austerity, new cases of aggressive tax planning
and the Panama Papers scandal have kept tax evasion
and avoidance in the spotlight both in the media and in
parliamentary debates in Finland.
For example, the Finnish centre-right government attempted
to introduce legislation that would allow Finnish investors to
hide their shareholdings under the guise of complying with
EU regulation on central securities depositories. 341 However,
EU regulation includes an exception that allows Finland to
maintain its current system, which is more transparent than
in most Member States. 342 Currently, the account holder at
the Central Securities Depository (often also the beneficial
owner), and national investors, are not able to hide behind
custodial account holders. Nominee registration of securities
is currently only possible for foreign investors. 343 In June, the
Parliament’s Commerce Committee asked the government
to introduce new legislation that would maintain the
transparency of shareholders. 344
In addition, the aggressive tax avoidance structure used by
the electric grid company Caruna, which holds a monopoly
position, sparked outrage in the first months of 2016. 345
In May, the Supreme Administrative Court ruled that two
multinational corporations had used artificial structures to
avoid taxes in Finland. The Tax Administration has similar
disputes ongoing with 10-20 companies. 346
Corporate tax scandals have also had direct links to
government ministers. 347 In September 2015, the media
revealed that Minister of Transport and Communication
Anne Berner served as a member of the board of a holding
company in Luxembourg which was accused of aggressive
tax planning. 348 In response, the minister said that, although
she had served on the board, she had filed her resignation
since becoming a minister and the Luxembourg company
was simply part of international capital raising. 349
In late 2015, the media exposed that another minister, the
Minister of Trade and Development Lenita Toivakka, served
on the board of a holding company in Belgium, which
allegedly was set up with the aim of avoiding taxes. 350 The
Minister admitted that the Belgian-based company was
founded partly for tax planning, but stated that the steps
taken had been commonplace and legitimate. 351
However, in June 2016, the Minister resigned partly due to
the scandal around the Belgian-based company. 352
As regards developing countries, the government
acknowledges that international decisions on tax have a
major impact on developing countries. 353 However, the main
focus of the government is on supporting capacity building
in developing countries, 354 rather than giving them a seat at
the table when international tax standards are negotiated
(see below under ‘Global solutions’). A Tax and Development
Action Programme was introduced in August. 355
Transparency
Public country by country reporting
Finland supports the Commission’s proposal on public
country by country reporting but is not promoting
disaggregated reporting for all countries or a lower
reporting threshold. A position paper by the Ministry
of Economic Affairs and Employment underlines that
Finland supports increased transparency, but that the
administrative burden for companies should not increase. 356
State-owned enterprises have been obliged to publish
country by country reports since 2015. However, the
vagueness of the reporting guidelines has led to poor-quality
reports that do not provide a comprehensive overview of the
companies’ tax structures. 357 The government’s new strategy
for state-owned enterprises includes a ban on aggressive tax
planning and a plan to produce uniform reporting instructions
reflecting the European Commission’s requirements on
country by country reporting. 358
Like most other EU Member States, and in line with the
legal requirements of the EU, Finland has introduced
public CBCR for the financial industry. 359 In November, the
Parliament adopted a bill that introduces non-public CBCR
for multinational corporations which are based in Finland
and have a turnover of a minimum of €750 million. 360
62 • Survival of the Richest