Finland takes legal steps on ECJ Danner pensions ruling

Finland’s Ministry of Finance will shortly submit to parliament legislation to bring the law governing the taxation of third pillar schemes into line with the recent EU ruling on the Danner case.

“The government bill will be submitted to parliament in May or June with a view to becoming law from the beginning of next year,” said Jukka Vanhanen of the Ministry of Finance in Helsinki.

In fact, the tax authorities implemented the ruling shortly after it was issued last October; the government is now bringing the law into line with the ruling.

The ruling means that pension contributions to and payouts from schemes set up in other EU states are subject to the same tax treatment as those drawn up with Finnish service providers.

The Danner case involved German-born Rolf Dieter Danner and challenges as contrary to an article of the EC Treaty a Finnish law that taxes pension insurance contributions made in Finland to a foreign institution.

The concerns of the Finnish authorities relate to ensuring that holders of policies from other EU states declare their contributions and subsequent pension payouts.

The disappointment of the Finnish government at the ruling of the European Court on the Danner case is clear: “We don’t have any good solutions to these problems,” said Varhanen. “We just have to follow the ruling of the European Court.”

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