Employing the calculations used by other EU countries, Finland's annual fiscal deficit would be between 4.6 and 7.7 billion euros, according to Yle TV1’s investigative documentary programme MOT, which will broadcast a report on Monday evening.
The tax shortfall is calculated by subtracting the amount of collected tax revenue from the amount of legally collectible taxes. The largest proportion of tax shortfall arises due to arrears – essentially, unpaid taxes. The figure includes the taxes that are due during one year but remain unpaid by the end of the next year. For 2012, that amounted to some 700 million euros.
Tax arrears are increasing steadily. About a year ago they amounted to 4.1 billion euros. The figure includes both operational companies and those that have gone bankrupt.
Only first steps for Finland
Unlike many other countries, Finland is only just figuring out how the tax gap should be assessed.
“The Swedish tax authorities have actively been chasing a fortune hidden in tax havens and seeking international tax agreements that would grant the right to obtain information on Swedish deposits to foreign banks," says Parliamentary Audit Committee chairperson Tuija Brax. "Sweden has been actively addressing this tax gap problem for some time.”
The Tax Administration collects annual taxes of around 65 billion euros.
Happy Taxpayers Association chairperson Minna Salminen says that politicians need to make more effort to deal with the shortfall.
“Politicians should take better care of the tax gap,” she says. “We need decisions that narrow the tax gap, not enable it. In fact, the tax gap does not arise because we have lazy authorities, but because the system makes it possible.”