Changes in VAT on 1 January 2013
Tax Administration Bulletin, 12/18/2012
A number of amendments in VAT will come into force from the beginning of 2013. All VAT rates are increased by one percentage point. Moreover, there will be changes regarding the invoicing, the minimum amount of VAT payable for the goods imported to Finland, the rules on long-term leasing of means of transport, and the rules governing appeals made by the VAT payers.
New VAT rates (Acts no 706-708/2012)
All VAT rates are raised by one percentage point in 2013. The new VAT rates are:
- 24 %: The general rate
- 14 %: The reduced rate for the supply of foodstuffs, animal feed and restaurant and catering services
- 10 %: The reduced rate for the supply of books, pharmaceutical products, services creating opportunities for physical exercise, passenger transportation, accommodation, the remuneration received by Yleisradio Oy from the TV and radio fund and by Ålands Radio and TV based on the TV licence fees, the entrance fees to cultural and recreational events, the supply and import of works of art in certain situations, the subscriptions of newspapers and periodicals and the remuneration relating to a copyright where received by an organization representing the copyright owners.
The rate of the Tax on Insurance Premiums is equally raised to 24 % corresponding to the general rate of VAT.
The VAT invoicing requirements (Act no 399/2012)
The Tax Administration has issued the new guidelines dated 18 October 2012 regarding the VAT invoicing requirements
The minimum amount of VAT payable on imports of goods is lowered (Act no 267/2011)
The minimum amount of VAT payable on imports of goods will be € 5.00 from the beginning of 2013. This concerns the importation of goods:
- to Finland from the non-EU countries
- to the mainland of Finland from the Åland Islands and vice versa
- to Finland from the other EU customs zones, but outside the EU VAT zone (e.g. the Canary Islands or the Channel Islands).
The above minimum is not applied to alcoholic beverages and tobacco that
- passengers carry in their luggage
- employees carry in their luggage if they work on board of a means of transport in traffic between Finland and a non-EU country
- are/is being sent to private individuals.
The place of supply -rules regarding long-term leasing of means of transport to consumers (Act no 886/2009)
The place of supply is in Finland if a leasing contract of a means of transport (other than pleasure boats) is a long-term and
- leasing service is rendered to a buyer's fixed establishment located in Finland
- leasing service is rendered to a buyer whose domicile is in Finland.
Long-term leasing of a pleasure boat to a consumer is deemed to be rendered in Finland if the boat is given to consumer´s use in Finland from a supplier´s fixed establishment or a domicile located in Finland. The place of supply is not deemed to be in Finland if the pleasure boat is long-term leased to a consumer so that the service is rendered from supplier´s fixed establishment or a domicile located in another country and the pleasure boat is given to consumer´s use in that other country.
For more information, see the guidelines of The Tax Administration
VAT appeals (Act no 877/2012)
The rules relating to appeals in VAT will change. In the future, the Administrative Court will lead the appeal process instead of the Tax Administration.
The Tax Administration will first treat the appeal as a correction requested by the taxable person. This procedure is the same as before the change. If the Tax Administration cannot agree on the request of a correction stated in the taxable person´s appeal, the Tax Administration will give a written statement regarding the appeal and send the appeal for further proceedings to the Administrative Court. The Administrative Court must give to the appellant and to the representative of the State (Tax Recipients' Legal Service Unit) the opportunity to issue a written reply or a clarification.
Other written claims or demands are handled by the Tax Administration as requests for correction made by the taxable person. The Tax Administration may correct an erroneous tax decision for the benefit of a taxable person. If, according to the Tax Administration, the decision does not include a mistake to the detriment of the taxable person, the Tax Administration issues a decision in the negative. Such a decision can be appealed.