Veroasteikot

Veroasteikot are the tiered structure used to calculate personal income tax in Finland. They define the marginal tax rate that applies to portions of an individual’s earned income as it crosses predefined income thresholds. The system combines municipal tax, applied by municipalities and varying by location, with a national income tax that is progressive. Church tax may also apply for members of church communities, and social security contributions are levied separately from the income tax.

In practice, the state tax is applied only to income above certain thresholds; as income increases, higher brackets become subject to higher rates. This creates a progressive overall tax burden: higher income generally faces higher marginal rates, though deductions and credits can reduce the final payment. The exact brackets and rates change with annual tax legislation approved by Parliament, and are adjusted to reflect policy goals and economic conditions.

Tax is typically collected through withholding during the year and reconciled after the tax year ends, when deductions and credits are applied to determine the final liability. The veroasteikot framework is central to Finland’s income taxation and is administered by Verohallinto, the Tax Administration. Understanding veroasteikot helps explain why the same gross income can yield different tax amounts for individuals due to differences in deductions, church status, and the municipality of residence.

See also: Taxation in Finland, Personal income tax, Verohallinto.