Finland Tax Agency Posts Preliminary Ruling Clarifying Application of Interest-Limitation Rules to Municipal Infrastructure Company

The Finnish Tax Administration March 16 posted online Central Tax Board Preliminary Decision No. KVL:2026/5, clarifying the application of interest-limitation rules to a municipal infrastructure company. The taxpayer, a company owned by several municipalities that built and operated a central wastewater treatment plant, sought clarification on whether interest expenses on loans that financed its wastewater infrastructure fell under Section 18a of the Business Income Tax Act. Upon review, the Central Tax Board clarified that: 1) the taxpayer qualified as a publicly owned infrastructure entity because it owned and managed wastewater assets used by municipal water utilities; 2) the capacity-based basic ...