Brussels, 14 October 2009
State aid: Commission endorses Finnish temporary tax incentives for productive investment
The European Commission has endorsed a Finnish proposal for tax incentives for productive investment projects. Under the proposed scheme, for the fiscal years 2009 and 2010 Finland would temporarily double the depreciation rates for new factory and workshop buildings as well as new machinery and equipment used in such buildings. The aim of the proposed scheme is to stimulate investment in response to the current economic downturn. The Commission found that the tax incentive was a general measure, as it would be available to all enterprises having factory or workshop buildings regardless of their location, size and sector. The measure therefore does not constitute state aid as defined in Article 87 of the EC Treaty and can be implemented.
EU Competition Commissioner Neelie Kroes said: "The temporary Finnish tax incentives for productive investment projects are a good example how to stimulate investment, especially in times of economic downturn, without favouring certain companies, regions or sectors."
The Finnish measure would accelerate the depreciation of new factory and workshop buildings as well as new machinery and equipment used in factory and workshop buildings. The accelerated depreciation would only be granted for the fiscal years 2009 and 2010.
Under the current regime, factory and workshop buildings are depreciated at a maximum regular depreciation rate of 7% per year. The proposed measure would double the maximum depreciation to 14% per year over a maximum period of two years. Machinery and equipment are currently depreciated at a rate of 25% per year. The new measure would double the depreciation to 50% per year.
The non-confidential version of the decision will be made available under the case number in the State Aid Register on the DG Competition website once any confidentiality issues have been resolved. New publications of state aid decisions on the internet and in the Official Journal are listed in the State Aid Weekly e-News .