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Finland mulls cuts to municipalities’ tax revenue from wind farms
Credit: Tapio Mainio – HS Aleksi Teivainen – HT © HELSINGIN SANOMAT Helsinki Times | 19 Feb 2014 | www.helsinkitimes.fi ~~
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Translate: FROM English | TO English
The Finnish Government is contemplating reducing the share of local governments of the real estate tax contributions of power plants, including wind farms.
“Last year, we received 1.1 million euros in real estate tax contributions from the hydro-electric power plants on the Iijoki river. In the future, they would drop to 550,000 euros,” laments Markku Kehus, the mayor of Ii.
Similarly, municipal revenue from wind farm operators would plunge.
“Public opposition to wind power may grow, if the tax gains are slashed. After that, it would make no sense to designate land areas for wind farms. Roughly two hectares of land is required for each wind turbine. It limits other land development projects,” points out Matti Soronen, the mayor of Pyhäjoki.
The Government has reached a preliminary agreement on the cuts.
“According to the proposal, municipalities would retain 50 per cent of their revenue from real estate taxes, while the other half would be used to balance tax revenues. Depending on their financial standing, municipalities could be entitled to recover a share of the other half,” explains Jukka Hakola, a special adviser on taxation at the Association of Finnish Local and Regional Authorities.
Inequalities between the tax revenues of municipalities are balanced through a tax revenue based system of central government transfers to municipalities.
Kehus considers the proposed cuts unreasonable. “Real estate tax revenue compensates for the adverse effects of power plants,” he views.
“Wind farms must provide tangible benefits. Only then can you garner the required local support for their construction,” Esko Tavia, the mayor of Simo, underlines while glancing up at the base of one of the country’s tallest wind turbines in Leipiö, Simo.
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