What to Look Forward in 2008 in Finland
@ 11:35 am Great expectations for 2008.
- Alcohol will be less advertised and more taxed. There may not be adverts on television between 7-21, nor in movie theaters except when the movie is K18 (extremely rare these days). There may not be adverts of “happy hour” prices outside establishments. And, “buying in bulk may not be cheaper” so if a dachshund is 6 euros then you need to be selling the beer per bottle at 50c and a case for 12. Alcohol tax goes up 10-15% spelling out that maybe you need to shell out an 1,50 more for a bottle of kossu, 20c more for plonk, and beer guzzlers will imbibe 5c more tax.
- Car tax is revamped to reflect the CO2 emissions. The amount of tax will vary from 10 -40%. Also, the old set amount deductions will be taken away when calculating the tax. The tax will go lower on small cars and high on big cars, the average amount of total taxation is said to drop by one sixth - just in other words meaning - if you keep driving the Nissan Micra. And, a new law preventing you to packing four people on the back seat comes to effect, you may no longer overload a passenger vehicle even temporarily.
- Energy taxes will rise. The government is getting its money somewhere, so fuels and electricity will be taxed more. What this spells out is that you pay an average 50 more for gas for the Micra in a year and if you heat a house with electricity, your bill will go up by 30, if by oil you end up paying another 5 as compared to 2007.
- Entertainment will also be more expensive. The tv-licence will be 215,45 per year, or 18,60 per month if you go on a monthly plan.
- Equality will rise. All the counties will now belong to the same “means test” category where the living expenses before were categorised in I and II rate. This means many rural area pensioners get a 20-30 euro raise per month. All pensioners will also get a small index increase in their pensions, and a tax bracket change is implemented in the 13 000 -31 000 / p.a bracket so that the pension isn’t more highly taxed than the equivalent amount of salary. However the rises won’t necessarily better the situation as the health care charges will be rising as well as the energy taxes.
- There is some light for the single parent households, an extra 10 for the single parent supplement.
- Taxation is getting lower. By 0,5% in all income scales. Huge relief, as is the few cents added to the mileage costs. To reflect the changing of times if a person has to have a second home to work in another town, you can now deduct a whopping 250 euros towards the rent.
- The national basic interest rate will rise from 4,25 to 4,75. meaning in other words that anyone with a debt will see their interests rise a fraction atleast. As a relief for those with unpaid debts, in 2008 the new law on collection sets a moratorium on debts. They actually can be written off after the maximum collection period, and you can die and the debts won’t be collected from the estate. Also, if you have been a co-signer, your liabilities end when the main signers debt gets written off.
So, with all that 0,5% - cannot afford no booze and cannot afford nowhere to go. Looks like 2008 will be another of these years.
In other words, the welfare state ripoff continues.
Comment by Kristian — Fri, Dec 28th, 2007 @ 12:24 pm
That sucks! Now you won’t be able to afford to drink away your pain. They do tax the hell out of you all over there though don’t they? And I thought I had it bad over here in the States, oh wait yeah I do have it bad. Raising taxes on fuel oil and electric would break me. I just spent 795 dollars I didn’t have on fuel oil today. Ridiculous. I’d be really pissed if I had to pay taxes on it. I guess that’s one good thing about Alaska, not so much in the way of taxes, unless you’re an oil company.
Comment by realtrue — Fri, Dec 28th, 2007 @ 12:25 pm
Well, Finland does have the lowest standard of living compared to western European countries. Overtaxation is mainly to blame.
http://www.nationmaster.com/graph/tax_tot_tax_as_of_gdp-taxation-total-as-of-gdp
Comment by Kristian — Fri, Dec 28th, 2007 @ 12:27 pm
The end is nigh! Repent! Repent!
Comment by Herkku — Fri, Dec 28th, 2007 @ 1:27 pm
Kristian, you really do not know the facts.
Yearly salary of 60 000 euros, single, belongs to church.
Net salaries:
Germany: 31350 euros.
Finland: 36800 euros.
Germany is somewhat cheaper than Finland but certainly not 33 percent less.
Source:
http://www.nettolohn.de/index.php
http://vero.fi/
Comment by tim73 — Fri, Dec 28th, 2007 @ 1:40 pm
An increase in tax on fuel? Well that means transport costs are going to rise which means prices in the shops for foodstuff and beer will rise. How will the government control price inflation? Answer - make sure people have less money to spend by increasing domestic energy prices. So higher prices and less disposable income. Right?
Comment by Anonymous — Fri, Dec 28th, 2007 @ 2:46 pm
Somewhat cheaper, Tim73? Germany is A LOT cheaper. That’s according to my cousin, who was once arguably as skeptical as you are. Now he finally came to the realization after living in Munich for a year. I just saw him over Christmas.
Regarding taxes,
-Church membership is optional; there’s NO obligation to pay church tax in Germany.
-Try the same calculation for 50K instead of 60K (I realize that Germany punishes high-income single people). But lower income people pay much less taxes in Germany than in Finland. Plus they benefit from:
-food prices that are 33% less.
-cars that cost half of Finland’s price.
http://www.auto24.de
-and restaurant/pub/entertainment prices that are at least 33% less (half-price in many cases, due to greater selection).
-Much cheaper beer and wine. The list goes on…
-Also, check the difference for married couples at any income level.
Comment by Kristian — Fri, Dec 28th, 2007 @ 2:51 pm
Of course the energy tax is on top of the surcharge for the Kyoto carbon credits, which the electric companies got for free from the State yet charge you for, all in the interest of the planet. If I read correctly, the German electric companies are now making more money selling their customers the credits for the energy they use than for the energy itself.
You can also look forward to the Euro finally declining against the dollar again.
Comment by Fred Fry — Fri, Dec 28th, 2007 @ 3:34 pm
“look forward to the Euro finally declining against the dollar again.”
darn, so Airbus will not go under as planned by the evil one?
Comment by winter “Yea, Proton Power, now in remission†— Fri, Dec 28th, 2007 @ 4:15 pm
@2 : and how many gallons did you get for that 795 dollars?
On a quick calculation 795 dollars is 541 euros. Now for 541 euros, I’d get… so 0.745 a liter(*) (a rough average if you got a deal or not and where its between 0.7 and 0.8) 726 liters of heating oil, which is what… 192 gallons?
(*)the price of 0.745 also includes the fuel taxes + 22% sales tax. So make that about $ 4.15 a gallon… If I got it right, a gallon of heating oil is around $3 in Alaska??? So what you mean “expensive” white man?
Comment by Hank W. — Fri, Dec 28th, 2007 @ 5:03 pm
winter: Looks like you need help from Canadians to defend Alaska:
“F-15 Grounding Strains U.S. Air Defenses
By SCOTT LINDLAW – 1 day ago
FRESNO, Calif. (AP)  The grounding of hundreds of F-15s because of dangerous structural defects is straining the nation’s air defense network, forcing some states to rely on their neighbors’ fighter jets for protection, and Alaska to depend on the Canadian military.”
http://ap.google.com/article/
ALeqM5gktRlRgP47yhNOiO0e_SG9DiU9LQD8TPC2UO1
And do not even start with that Airbus-Boeing stuff. Boeing is also getting a lot of hidden subsidies from states and no-bid military contracts.
Comment by tim73 — Fri, Dec 28th, 2007 @ 5:08 pm
realtrue - ” I just spent 795 dollars I didn’t have on fuel oil today. Ridiculous. I’d be really pissed if I had to pay taxes on it.”
I don’t think you’re going to get much sympathy from the euro crowd who have been paying twice what we’re paying even now for fuel. We installed thermal windows and switched to natural gas from fuel oil this summer and I no longer have a breeze in my living room and the heating expense is much lower. I’ve never figured out how people in cold climates continue to exist with inefficient heating and breezy homes. I suppose that when the houses were built here in New England, fuel was cheap and nobody cared if there wasn’t any insulation in the walls. You live in Alaska and if you haven’t invested in good insulation and windows, don’t whine about how much you’re spending on fuel to heat your home.
Comment by hfb — Fri, Dec 28th, 2007 @ 5:08 pm
timmy timmy timmy
“F-15 Grounding ” was like 3-4 weeks ago, when one fell out of the sky (Pilot ok, he ejected like a liberal when faced with the real reality of his world comming apart)
Speaking of fuel, the old house we bulldozed 7 months ago, was built in the 1950’s. We found zero insulation in the walls and ceiling of the original 2 bedroom, but the expanded parts were added in the 1980’s had insulation. Switching from oil to gas was done, just so I did not have to clean up after the oil. Gas has less of a mess, and seems to be about the same cost, $2.60 a Gallon as of last week.
Comment by winter “Yea, Proton Power, now in remission†— Fri, Dec 28th, 2007 @ 6:35 pm
My new year’s eve wish will be the complete removal of the tv-license.
Comment by Mikael — Fri, Dec 28th, 2007 @ 6:40 pm
My new year’s eve wish will be the complete removal of winturd.
Comment by Dave the Davelator — Fri, Dec 28th, 2007 @ 7:30 pm
“Church membership is optional; there’s NO obligation to pay church tax in Germany.”
You’re not forced to pay church tax in Finland either..
Comment by beeta — Fri, Dec 28th, 2007 @ 9:00 pm
Well, the Finnish standard of living is among the highest in _this_ universe. You have to realise that Kristian is talking about the his own universe.
Comment by Anonymous — Fri, Dec 28th, 2007 @ 9:08 pm
#17: You’re the most brainwashed person in this universe. Your level of argumentation is a prime example of the huge gaps in the Finnish public education system, which is geared towards learning meaningless facts by heart and scoring the PISA tests. You, sir, are a mindless welfare state drone who wouldn’t recognize a fact even if hit in the head with one, let alone being capable of presenting a coherent counterargument. You’re an insult to humanity. Now go back to your government job.
Comment by mh — Sat, Dec 29th, 2007 @ 1:22 am
Winter, you candyass, you live in Merlin which doesn’t get cold, really. And bulldozing is what just about every home, aka eyesore, built in the 50s, 60s and most of the 70s deserves. I can forgive the 1910s and 20s builders in my neighbourhood as houses should be updated now and then as long as the bones are solid. Still….the house next door has the original windows and no storms on them so I can’t imagine how they keep it warm or afford to do so. And natural gas is more efficient with steam/hot water radiators and a reasonably insulated house vs. a crappy old oil boiler with breezy 90 year old windows.
Comment by hfb — Sat, Dec 29th, 2007 @ 3:06 am
Why do I keep feeling like all Finns think about is taxes? Can’t you shed a bit more light on joiking, sauna construction, the marketing of Lapin Kulta?
Comment by giustino — Sat, Dec 29th, 2007 @ 2:50 pm
Why do I keep feeling like all Finns think about is taxes? Can’t you shed a bit more light on joiking, sauna construction, the marketing of Lapin Kulta?
It’s very far from all we think about! Sadly it is almost all 2 of FfT’s guest contributors think about ;). I agree with the sentiments in your message - My wish for 2008 would be that Phil regains control of his blog and returns it to its former high quality.
Incidentally, Giustino, your blog on Estonia is very good. I read it now and then, I don’t make comments as I haven’t got myself a Google account. Perhaps I shall one of these days.
Comment by JG — Sat, Dec 29th, 2007 @ 3:37 pm
Dave Dave Dave
“complete removal” was last years resolution. What agin, you have no original thoughts from the left side of the house?
Comment by winter “Yea, Proton Power, now in remission†— Sat, Dec 29th, 2007 @ 4:26 pm
@20 Well, we need to pay them.
Comment by Hank W. — Sat, Dec 29th, 2007 @ 4:40 pm
giustino : “Why do I keep feeling like all Finns think about is taxes?”
Actually, Finns think more about—e.g. why they can’t enjoy a more dynamic market economy, with competitive pricing, as in central Europe. It’s an especially popular topic amongst the many Finns who regularly schlep low-priced consumer products, cars, etc., back from Germany via Silja Line and Superfast. Such conversations are commonly heard in the ships’ dining saloons.
Unfortunately, it doesn’t always occur to them that high-taxes, combined with a highly-centralized form of government, is the direct cause of Finland’s lackluster standard of living.
Comment by Kristian — Sat, Dec 29th, 2007 @ 6:39 pm
Kristian:
“Unfortunately, it doesn’t always occur to them that high-taxes, combined with a highly-centralized form of government, is the direct cause of Finland’s lackluster standard of living.”
We should remember that when Finland’s low standard of living is discussed, it always concerns the upper middle class, or people who would be upper middle class in other countries. This, again, has more to do with Finland’s oligopolistic labour market than taxes. Making Finland a tax haven would not change this one iota. Well, there would no longer be affordable municipal housing for Nokia engineers, so they’d have to move to mom’s basement or under the bridge. As for the lower income classes, they enjoy an excellent standard of living - quite competitive against, say, Germany and completely from a different planet compared to, say, Albania or the US.
Fortunately, the exploited white collar proletariat can find solace in ditching the corporate treadmill and taking their fate in their own hands through entrepreneurship.
Comment by Freeridin' Franklin — Sun, Dec 30th, 2007 @ 4:27 am
“We should remember that when Finland’s low standard of living is discussed, it always concerns the upper middle class, or people who would be upper middle class in other countries. This, again, has more to do with Finland’s oligopolistic labour market than taxes.”
On the contrary, upper middle class wage earners have it reasonably good in Finland. That’s because only small percentages of their respective budgets are affected by the overpriced local economy. And they can sidestep many of the bigger costs that ordinary people face, by purchasing key items abroad. And vacationing abroad in lower-priced destination for that matter—even if only a short trip to c. Europe.
Another nice benefit for high earners is to transfer abroad for a few years and save a pile of money. Then, they can move back to Finland and live better than their peers. Many luxury automobiles have found their way into Finland that way, sans autovero.
Lower income people are the ones who have to pay for—e.g. overpriced groceries, restaurants and entertainment. Forget about traveling anywhere outside of their respective cities; transportation costs are nearly twice Germany’s. Hostel/hotel costs are also about twice Germany’s.
Furthermore, healthcare is mediocre for low income people in Finland, compared to what’s offered in Germany.
You might have a point about it being better than Albania, though.
“This, again, has more to do with Finland’s oligopolistic labour market than taxes.”
And what do you think causes the oligopolistic behavior?
http://en.wikipedia.org/wiki/Tax_wedge
Comment by Kristian — Sun, Dec 30th, 2007 @ 10:44 am
Kristian:
“And what do you think causes the oligopolistic behavior?”
Good question. Clearly taxes are a flimsy, ideologically-based explanation as countries with a higher tax burden have better functioning local economies and the oligopolies of Finland have only strengthened during the tax-slashing orgy of the 90s.
Comment by Freeridin' Franklin — Sun, Dec 30th, 2007 @ 6:45 pm
It’s Forumer birthday!
Comment by Ji — Sun, Dec 30th, 2007 @ 7:01 pm
“countries with a higher tax burden have better functioning local economies”
Can you name one? —that isn’t bolstered by its own oil/gas reserves?
http://www.nationmaster.com/graph/tax_tot_tax_as_of_gdp-taxation
“the oligopolies of Finland have only strengthened during the tax-slashing orgy of the 90s.”
If you slash corporate taxes but leave individual taxes high, then that’s exactly what happens.
Aside from over-regulation, it’s the best protectionism that *existing* companies could possibly have.
Comment by Kristian — Sun, Dec 30th, 2007 @ 10:40 pm
Kristian:
“Can you name one? â€â€that isn’t bolstered by its own oil/gas reserves?”
The most obvious choice is Sweden, of course. Belgium is another one. Can you name a low tax paradise that has a functioning society and is not bolstered by Nazi gold and drug money?
“If you slash corporate taxes but leave individual taxes high, then that’s exactly what happens.”
It’s only that it’s precisely income tax that has been cut the most.
Comment by Freeridin' Franklin — Mon, Dec 31st, 2007 @ 12:04 pm
“The most obvious choice is Sweden, of course. Belgium is another one. ”
Neither have especially high standards-of-living or purchasing power—in western European terms, they are both near the bottom, albeit slightly above Finland. I won’t say they are worse than, say, Zimbabwe though.
“Can you name a low tax paradise”
Nothing in Europe really qualifies as a “low tax paradise.” There are competitive countries that are smartly structured. But no real paradises.
“that has a functioning society and is not bolstered by Nazi gold”
That leaves Sweden out, once again. Despite benefiting during ww2, the standard-of-living in Sweden is nothing to brag about.
“It’s only that it’s precisely income tax that has been cut the most.”
Unfortunately there are other taxes , besides income taxes, that affect individuals.
Finland also has exceptionally high VAT and protectionism via autovero… Plus it took several years allowing outside competitors like Lidl and Ikea to even operate in Finland… Then there’s the indirect effect caused by government monopoly, like Alko and alcohol pricing in general…
All these measures keep prices high, and prevent individuals from aquiring startup capital. And they reduce their chances of success even if they manage to take the first step (success meaning that they get a suitable return on investment, not just so the owner can live the same as he would as an employee somewhere).
All these measures give existing businesses in Finland a big advantage over potential startup competitors. They especially help big foreign ones, whose owners don’t need to live according to the constraints of the Finnish economy.
Comment by Kristian — Mon, Dec 31st, 2007 @ 1:18 pm
@30 &31 that has a functioning society
That leaves Belgium out then, looking at the Walloon/Flemish divide. I mean do you call it a fucking functioning society a policeman may not speak in French in a Flemish county behind the desk?
Comment by Hank W. — Mon, Dec 31st, 2007 @ 3:29 pm