Government submits supplementary budget proposal to Parliament
On Thursday 27 February, the Government submitted a supplementary budget proposal for 2025 to Parliament. The key proposal in the supplementary budget is an increase to the defence materiel assistance provided to Ukraine. The proposal also includes an increase to revenue estimates.
The supplementary budget proposal includes an increase of EUR 113 million to the requirement for appropriations and an increase of EUR 324 to actual revenues. Together, these will reduce the central government’s net borrowing requirement by EUR 211 million, with net borrowing expected to total around EUR 12.3 billion in 2025.
Proposal reflects support for Ukraine and effects of previous decisions
Finland’s Government Programme includes a commitment to supporting Ukraine. An increase of EUR 222.2 million is proposed to the Defence Forces’ UKR 2023 procurement authority to replace the defence materiel included in support packages 26 and 27 provided to Ukraine. An increase of EUR 623.8 million is proposed to the UKR 2024 procurement authority. This will increase the total funding for orders from the Finnish defence industry to support Ukraine to EUR 660 million. A total of EUR 97 million of the expenditure arising from the use of the latter procurement authority will be covered using income from the European Peace Facility. In other respects, the procurement authorities will give rise to additional expenditure in 2028 at the earliest.
The Government previously submitted a proposal to Parliament for an act amending the Health Care Act that would exclude health checks of driving licence applicants from the scope of the wellbeing services counties’ responsibility for organising services. The legislative amendment would reduce the funding of wellbeing services counties by EUR 2.4 million in 2025, which is reflected in the supplementary budget proposal. Previous decisions to expand reimbursements for medical expenses and include infertility treatments in the scope of reimbursement are included in the supplementary budget proposal as a EUR 16.3 million appropriation increase.
Revenue estimates take into account Ministry of Finance's December forecast
An increase of EUR 324 million is proposed to the revenue estimate, with tax revenues accounting for EUR 227 million of this increase. The new tax revenue estimate is based on the macroeconomic forecast published by the Ministry of Finance in December 2024. A decrease of EUR 134 million is proposed to the revenue from corporate income tax based on accrual data. In contrast, an increase of EUR 361 million is proposed to revenue from the excise duty on tobacco products due to a change in timing. This change in timing is mainly due to lower than usual stockpiling by taxpayers prior to the increase to the excise duty, which was implemented on 1 November 2024. This resulted in the shift of tax revenue from 2025 to 2024 being lower than estimated.
An increase of EUR 97 million is proposed for the estimate of miscellaneous revenue. This increase is due to income from the European Peace Facility.
Inquiries: Mikko Martikkala, Special Adviser to the Prime Minister in Economic Affairs, tel. +358 295 161 171, and Jussi Lindgren, Special Adviser to the Minister of Finance in Economic Affairs, tel. +358 295 530 514
The email addresses of the Finnish Government are in the format [email protected]