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Taxes make Finnish food costly in EU comparison

Finnish consumers paid around a fifth more for food than the EU average last year, according to Statistics Finland. The main culprit for the high prices is taxation.

Ihminen pakkaa ruokia kassiin kaupan kassalla.
Finnish groceries continue to be costly in 2013. Image: Juha Korhonen / Yle

Of the 15 so-called 'old' EU countries, Finland was the fourth most expensive after Denmark, Sweden and Austria in 2012.

The difference is mainly down to tax: Finnish VAT is levied at 14 percent on food purchases, which was the second highest rate in the comparison. In Ireland the corresponding tax rate is zero, while the average VAT levied in EU countries is 5.7 percent.

Concentration of the grocery market in the hands of two large companies, the S-group and Kesko, also plays a part in the high cost of Finnish groceries.

No relief in sight

In 2013, Finns’ food bills continue to be high compared with the rest of Europe. According to Statistics Finland, the price of groceries has nearly doubled this year in comparison to old EU countries.

In June, food was some 15 percent more expensive here than in old EU countries on average.

Ilkka Lehtinen from Statistics Finland notes that countries’ salary sizes and prices go hand-in-hand, which is why the price comparison was carried out mainly between Finland and the old EU countries, as these have similar wage levels.

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