Finland/ 5.1 General legislation  

5.1.5 Tax laws

There are no legislation or special administrative arrangements that would offer incentives for business sponsorship. On the other hand, income taxation legislation (Income Tax Act, paragraph 57, amended in 2007) offers tax deductions for donations.

More specifically corporate actors (not a private individual) can deduct:

• a minimum of 850 EUR and a maximum of 250 000 EUR donation to promote art or science or to support the protection of the cultural heritage; the deduction limits are the same where the receiver is another EEA state, publicly supported university or other institute of higher education or a fund linked to either of the latter two;

and other deduction limits are

• a minimum of 850 EUR and a maximum of 50 000 EUR donation to promote science, art or to preserve Finnish cultural heritage and where the receiver is an association or a fund linked to either of these two and has its main goal to promote arts, science or preservation of Finnish cultural heritage and belongs to the Taxation Board's list of the rightful receivers.

The Income Tax Act (paragraph 22) also defines the criteria for non-profit organisations ("organisations accruing collective benefits"), which can have total income tax relief for their small-scale non-commercial business activities. There have been debates under which condition this tax relief may be in conflict with the EU Treaty, Article 87, which prohibits competition distorting subsidies or financial transfers of any other forms of resources to market organisations.

Regarding tax rates, the Finnish VAT Act has been enacted to suit the valid EC / EU VAT directives. Since July 2010 the basic VAT-rate in Finland has been 23%. The lower VAT-rate of 9% is applied for books and income fees of cultural, art and entertainment services and performances (entrance fees to museums, box office receipts from cinemas, theatres, orchestras and circus, music and dance performances). The VAT on sales of (non-exported) works of art, by artists or by individual owners of artist's rights (initially zero rate until the end of year 2002), is also 9%. The VAT-rate on the price of newspapers and journals was zero until the end of 2011, but since 1 January 2012 the VAT-rate of 9% has been applied also to this sector. On government decision of March 2012 the VAT-rate will be raised from 1.1.2013 onwards to 24% and 10% respectively.

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