The clear majority of Finnish taxpayers feel that they get a good return for their money. In fact, it might just be the biggest reason for Finland’s consistent ranking as the happiest country in the world. So, how does the country’s much-lauded system work?
In Finland, taxes are paid on both earned and capital income. Earned income includes your salary and any taxable social benefits, such as unemployment and parental leave, while capital income is generated through the possession of personal wealth, including rental income or earnings from the sale of any assets.
If you plan to move to Finland for long-term work, expect to pay earned income tax on your salary. These taxes are progressive, meaning the more money you earn, the more taxes you’ll pay. Finland’s progressive tax system has been in place since 1920, and it’s one of the cornerstones of the Nordic welfare state.