Finland is making a strategic push to strengthen its position as a Nordic hub for technology and innovation, using corporate tax reform and targeted incentives to attract international investors.

From January 2027, Finland’s corporate income tax rate will drop from 20% to 18%, while tax losses can now be carried forward for 25 years instead of 10. These changes are designed to make Finland more competitive for startup investment, particularly in high-growth sectors such as fintech, data centers, and advanced technology. By aligning fiscal policy with innovation-driven growth, Finland aims to secure a larger share of global tech capital.

The reform places Finland’s corporate tax below most Nordic countries, including Sweden (20.6%) and Norway and Denmark (22%), while remaining competitive relative to selected EU peers like Hungary (9%) and Lithuania (16%). “Finland is offering an increasingly forward-looking tax environment for companies that value innovation, sustainability, and long-term growth,” said Kaija Laitinen, senior advisor at Invest in Finland.

Incentives for Talent
To attract and retain top international talent, Finland will reduce taxation on so-called foreign key employees (FKEs) from 32% to 25% starting January 2026. Under the Key Employees Act, qualifying employees benefit from a flat tax rate for up to seven years, making Finland an attractive destination for tech specialists.

A new scheme also allows employees of startups and scaleups to receive shares without triggering taxable benefits, provided the subscription price matches the share’s net worth. “This aligns employee incentives with long-term company success,” Laitinen noted.

R&D and Startup Investment
Finland offers permanent R&D tax incentives: a 100% basic deduction plus an additional 50% deduction for expenditures exceeding the previous year’s R&D spend. Foreign-owned and domestic companies subcontracting R&D through Finnish universities or technical institutes may also qualify for a super 250% deduction.

The government’s initiatives are expected to triple domestic R&D investment to over €900 million by 2028, supporting startups that operate at the forefront of emerging technologies. In 2024, Finnish tech startups raised €1.4 billion, a 56% increase year-over-year, with international investors contributing €957 million, up 70% from 2023.

Finland’s Edtech and Knowledge Economy
Education technology remains a standout sector. Employing over 2,000 workers, Finland’s edtech companies generated €290 million in revenue in 2023 while expanding globally and maintaining a strong commitment to social impact and pedagogical quality, according to Heini Karppinen, senior advisor at Edtech Finland.

Growing FDI and Economic Impact
Finland’s foreign direct investment stock reached €83.5 billion at year-end 2024, creating 109,000 jobs from foreign-owned companies between 2010 and 2023. The combination of tax reform, talent incentives, R&D support, and startup-friendly policies positions Finland as a Nordic launchpad for tech investment, offering both stability and growth potential for global investors.