Finland moves to introduce tourist tax

The four-party alliance government led by conservative Kansallinen Kokoomus (National Coalition Party-NCP) has taken an initiative to introduce tourist tax for the municipalities, said the Ministry of Finance in a press release on Friday.

The government is drafting a new law with the provisions for allowing the municipalities to collect a tourist tax.

Individual municipality would decide whether to adopt the tax.

The Ministry of Finance has assessed the feasibility of adopting a tourist tax in Finland. A preliminary report has been drawn up and key stakeholders consulted in preparation for the drafting work. Based on the initial report, the government decided to begin legislative drafting of a tourist tax.

“A tourist tax would give municipalities that are popular tourist destinations a way to collect more income from tourism. The goal is to create a simple and clear tax model. Municipalities themselves would decide whether to adopt the tax,” said Minister of Finance Riikka Purra in the press release.

A tourist tax is typically a tax paid in connection with short-term accommodation. Several EU countries already have this kind of tax.

As this would be a new kind of tax in Finland, adopting it requires that provisions on it be laid down in an act.

The act would define the conditions under which municipalities could adopt the tax if they so wish.

The tax revenues would remain with the municipality collecting the tax.

In order for different forms of accommodation to be treated equally, the tourist tax would apply to stays by both domestic and foreign travellers and to all forms of temporary paid accommodation.