Government’s confectionery tax plan gets more much criticism: to weaken employment and jeopardize investment

The health effects of tax are considered to be minor and full -to -xylitol is to be excluded.

The government’s proposal for the increase in confectionery and chocolate tax is strongly criticized in the consultation round.

Most statements are opposed to the government’s proposal to raise the current tax rate of 14 % of the sweets and chocolate to a general tax rate of 25.5.

The statements submitted emphasized the concern that the tax increase will weaken employment and endanger new investments.

The proposal is also considered to be contrary to the objectives of the Government Program: at worst, it weakens the competitiveness of the domestic food industry and leads to the increase in the share of cheaper import products.

The government’s proposal states that the health effects of change are estimated to be shallow.

In 2011-2016, a confectionery tax was used in Finland, the effects of which was conducted. Based on this, the consumption of sweets, chocolate and ice cream did not decrease, although prices rose by about 10 % on average.

Now, the statements point out that since the tax reasoning is not related to health effects, its economic and competitiveness disadvantages are further emphasized.

THL wants a wider health tax tax

The National Institute for Health and Welfare THL and the Finnish Dental Association are in favor of tax, but they are also reserved. They believe that full -patch products should be excluded from the bill.

They also think the performance is too narrow.

THL supports a broader health -based taxation than the government’s proposal. It would target foods that are high in fat, salt and sugar.

Päijät-Häme fears for its investment

Particular concern The tax increase is caused by Päijät-Häme, where Fazer has planned a major investment. Fazer has now frozen its plans for a chocolate factory to be built in Lahti.

In their statement, the Päijät-Häme Federation and the municipalities of Päijät-Häme recall that the cancellation of up to EUR 750 million will endanger jobs during construction. In addition, hundreds of permanent jobs are at risk when production starts.

Päijät-Häme Entrepreneurs points out that the loss of the Fazer’s factory is not only suffering from Päijät-Häme but throughout Finland if Fazer moves his investment to Sweden due to a tax increase.

Lappeenranta is also concerned about the future of Fazer’s confectionery. According to the city, the tax increase would have a significant negative impact on the operating conditions and future prospects of the factory employing about 450 employees.

Additional cost and administrative burden?

The Micro and Simplifier Association points out that there are also many small companies in Finland that make sweets and chocolate products.

According to the association, the tax increase is heavily treated by small entrepreneurs, as it is not always possible to transfer increasing tax to full prices.

In addition to costs, the presentation brings an administrative burden to entrepreneurs. Finnish Entrepreneurs are making concerns, among other things, on how small companies survive the problems of interpreting customs titles. This refers to what products are among the products being transmitted to the general tax rate.

The complication of the same attention has been made by the Tax Administration. The taxpayer believes that the law will increase the administrative burden of businesses, the complicated tax system and to cause the cost of the salary of about 20 people and the costs of the tax administration.

The uncertainty is increased that the law is to enter into force on June 1, 2025. Companies have very little time to prepare for the changes it brings.

The consultation round ended on Friday 7 February. On Friday night, 21 statements were available on the Ministry of Finance’s project pages.