---
title: "Cut the Taxes: Finland the Hardest Taxer | Elias Erämaja | Neuvottelija 195"
titleOriginal: "Verot alas Suomi kovin verottaja | Elias Erämaja | Neuvottelija 195"
episodeNumber: "195"
guest: "Elias Erämaja"
datePublished: 2023-06-09
duration: "36:13"
youtube: "https://www.youtube.com/watch?v=ZCdrb_0PBx4"
originalLanguage: "fi"
topics: ["finnish_economy_policy","ownership_capital_tax"]
subtitleMethod: "none"
provenance: "Owner page assembled from YouTube metadata, the neuvottelija.fi episode record and a MacWhisper transcription of the Finnish audio. The chapter marks are the publisher's own list as released with the video, each verified to fall within ten seconds of a real transcript cue and translated into English here. No English caption track was produced, so no transcript is published here. The episode was made in commercial collaboration with Suomen Ekonomit ry, which is stated in the publisher's own show notes and read aloud in the episode, and is carried onto this page and into both AI-edition articles. The transcription contains one gap of about 28.4 seconds at 00:09:49, between the Wahlroos thought experiment and the solidarity tax section; the summary is written only from what the transcript contains and the gap has not been filled by inference. The transcript carries no speaker labels, but with a single guest the speakers are reliably distinguishable."
fiCanonical: "https://www.neuvottelija.fi/fi/episodes/287-verot-alas-suomi-kovin-verottaja-elias-eramaja-neuvottelija"
canonical: https://www.neuvottelija.com/podcast/episodes/ep195-verot-alas-suomi-kovin-verottaja-elias-eramaja/
---
# Cut the Taxes: Finland the Hardest Taxer | Elias Erämaja | Neuvottelija 195

English subtitles are not available on this page. This is an episode summary, not a curated transcript.

## Chapters

- [00:00](https://www.youtube.com/watch?v=ZCdrb_0PBx4&t=0s) Elias Erämaja, chief economist of Suomen Ekonomit ry
- [00:40](https://www.youtube.com/watch?v=ZCdrb_0PBx4&t=40s) Moving between employee and employer unions is common — Elias's career
- [01:10](https://www.youtube.com/watch?v=ZCdrb_0PBx4&t=70s) Suomen Ekonomit close to economists' thinking, serving graduates of Aalto, Hanken and the social sciences
- [03:10](https://www.youtube.com/watch?v=ZCdrb_0PBx4&t=190s) Members' median pay has fallen in real terms back to a decade ago
- [03:57](https://www.youtube.com/watch?v=ZCdrb_0PBx4&t=237s) Finland's very high marginal rates near 60% are among the world's heaviest
- [05:40](https://www.youtube.com/watch?v=ZCdrb_0PBx4&t=340s) Even middle earners are over-taxed in Finland, above 50% marginal. Sweden has cut taxes a great deal
- [06:40](https://www.youtube.com/watch?v=ZCdrb_0PBx4&t=400s) Are Finnish wages low both net and gross because of taxes on work?
- [08:54](https://www.youtube.com/watch?v=ZCdrb_0PBx4&t=534s) Nalle Wahlroos's thought experiment — tax leisure instead
- [09:57](https://www.youtube.com/watch?v=ZCdrb_0PBx4&t=597s) The 2013 “temporary” solidarity tax should end in 2023
- [11:47](https://www.youtube.com/watch?v=ZCdrb_0PBx4&t=707s) Finland's high taxation against Sweden and the EU's key competitor countries
- [14:20](https://www.youtube.com/watch?v=ZCdrb_0PBx4&t=860s) The Laffer curve in Finland — an underrated piece of economic theory?
- [16:30](https://www.youtube.com/watch?v=ZCdrb_0PBx4&t=990s) The irrationality of the tax debate
- [18:50](https://www.youtube.com/watch?v=ZCdrb_0PBx4&t=1130s) Flat-taxed Estonians on high incomes are repelled by Finland's taxation
- [21:40](https://www.youtube.com/watch?v=ZCdrb_0PBx4&t=1300s) The effect of the wellbeing services counties on taxation
- [24:00](https://www.youtube.com/watch?v=ZCdrb_0PBx4&t=1440s) Three wishes for the government programme — moderate taxes, work-based immigration and productivity
- [28:00](https://www.youtube.com/watch?v=ZCdrb_0PBx4&t=1680s) Fix productivity
- [29:50](https://www.youtube.com/watch?v=ZCdrb_0PBx4&t=1790s) The loss of purchasing power, for worse and for better — fifteen years
- [33:34](https://www.youtube.com/watch?v=ZCdrb_0PBx4&t=2014s) Index adjustments below inflation as a tightening of taxation
- [34:15](https://www.youtube.com/watch?v=ZCdrb_0PBx4&t=2055s) Problems with the finance ministry's forecast
- [35:05](https://www.youtube.com/watch?v=ZCdrb_0PBx4&t=2105s) Summary and outro

## Summary

**Elias Erämaja**, chief economist of Suomen Ekonomit, came on to discuss Finland's
marginal tax rates, recorded in the final week of the 2023 government formation talks.
The episode was made in commercial collaboration with Suomen Ekonomit ry, which is stated
in the episode itself.

**The figure that carries the episode is not the top rate but where it starts.** Erämaja
puts Finland's highest marginal rate at close to 60 per cent and calls it internationally
top-tier; Miettinen's point is that "this almost two-thirds robbery happens at really low
levels", at roughly 1.8 times the average wage, where there are countries in which the
equivalent level bites only at 30 times. Fifty per cent is already reached in the middle
bracket. Against Sweden, Finnish marginal rates are higher in practically every bracket
save a narrow window around €75,000 — and Finland is actually *cheaper* than Sweden at low
incomes, which is precisely the shape that tax cuts aimed at the bottom produce.

**His strongest argument answers the standard objection.** Microsimulations treat labour
supply as rigid, and Erämaja agrees it largely is: nobody packs up overnight for Estonia
over a tax rate. But the mechanism that bites is different — a specialist offered line
management, seeing 60 per cent of the raise taken, declines it, and somebody else takes the
job. The damage shows not in the employment rate but in the allocation of talent and in
hours worked.

**The solidarity tax gets an exact timeline**, which is the most quotable stretch:
temporary in 2013, meant to expire with the 2015 term, threshold €100,000 then, as low as
about €72,800 under Sipilä, €85,800 this year — and around €120,000 if the original intent
were preserved against inflation. Technically it is two percentage points stapled onto the
top state brackets. The Swedish comparison is what makes it interesting: a
social-democrat-led government abolished Sweden's equivalent and cut top rates by five
points, and the preparatory analysis put self-financing at between 58 per cent at the
pessimistic end and over 180 per cent at the other.

**On Laffer, Miettinen is careful about his own case** — he describes getting "entirely
deserved pushback" for calculating a curve on aggregate tax rates — and Erämaja offers the
example that needs no such argument: cutting the corporate rate brought more money into the
Finnish treasury.

**On Estonia**, the flat rate inverts the picture: purchasing-power adjusted, a Finn on a
low income can net less than an Estonian, while at specialist level the gap against Finland
is very large. Erämaja's summary is uncomfortable: Finland is relatively competitive at
attracting lower-income people and not competitive for high-skill people.

**Three wishes for the government programme**: lighter progression on the Swedish model;
work-based immigration of about 45,000 net a year against a long-run 15,000 and last year's
30,000-plus, without which people aged 85 and over become the largest five-year cohort as
early as the 2050s; and productivity, measured as euros per hour worked, where a
just-published ETLA and Labore study finds industry fine and services stalled.

**The closing section is the quietest and the sharpest.** Purchasing power fell last year by
as much as in the 1977 oil crisis, and by the first quarter households' real purchasing
power stood at its 2008 level — nearly fifteen years wiped out. Income tax schedules are
adjusted by the earnings index, a sensible choice when earnings outran inflation and a
damaging one now that they do not: adjustments of 3.0 per cent for 2022 against 7.1 per
cent inflation, and 3.5 per cent for 2023 against about 5 per cent. Taxation tightened,
in Erämaja's phrase, "almost unnoticed" — not by a decision to raise taxes but by leaving
the schedules uncorrected.

## A note on the source

The transcription contains one gap of about 28.4 seconds at 00:09:49, between the Wahlroos
thought experiment and the solidarity tax section; speech resumes in short fragments whose
opening was not recorded. This summary is written only from what the transcript contains.
The transcript carries no speaker labels, but with a single guest the speakers are reliably
distinguishable.

## Watch

The recording lives on the Neuvottelija channel:
[Verot alas Suomi kovin verottaja | Elias Erämaja | Neuvottelija 195](https://www.youtube.com/watch?v=ZCdrb_0PBx4).
A Finnish edition of this episode is published at
[www.neuvottelija.fi](https://www.neuvottelija.fi/fi/episodes/287-verot-alas-suomi-kovin-verottaja-elias-eramaja-neuvottelija).

---

Cite as: Sami Miettinen, Neuvottelija — Cut the Taxes: Finland the Hardest Taxer | Elias Erämaja | Neuvottelija 195, https://www.neuvottelija.com/podcast/episodes/ep195-verot-alas-suomi-kovin-verottaja-elias-eramaja/, 2023-06-09. For quotes include episode 195 and timestamp.