UPM’s corporate income tax in Finland reaches nearly EUR 90 million

17 April 2015

UPM pays income tax where added value is created and profit generated. As a result, especially in the countries where UPM’s different business areas have significant value-adding operations, the company is also a major tax payer both of direct taxes (for example corporate income tax, property tax) and indirect taxes (value added tax). In addition to Finland, UPM has significant investments in production, for example in Uruguay, Germany, China, the UK and the USA.

Corporate income tax particularly, which is based on the company’s taxable profits, is directly proportional to the company’s profitability. UPM has worked systematically to improve its profitability over the past few years, not only through increasing its cost efficiency and making savings, but also by investing in new operations.

Corporate income tax is paid in accordance with local legislation. In some countries, governments support companies making significant investments, for example by granting temporary operating permits for special economic zones. In Uruguay, the government has granted a permit to UPM’s pulp mill to operate in a free trade zone.

Finland’s corporate income tax rate decreased to 20% from the beginning of 2014. UPM’s corporate income tax in Finland in 2014, estimated at nearly EUR 90 million, has been calculated at the tax rate of 20%. In 2013, UPM’s corporate income tax in Finland was EUR 116 million at the tax rate of 24.5%.

UPM is one of Finland’s biggest tax payers

Despite the challenging operating environment, UPM has been able to improve its results through its own actions year on year, and thus the amount of taxes paid has also increased.

Another reason for the large amount of taxes paid is that UPM has significant operations in Finland through all of its six business areas. At the same time as some operations have been reduced, new operations have been started and new service concepts have been developed.

Investments have been made in production and service operations as well as in research and development, which will contribute to the results in the future. For example, following research work carried out in Finland, the production of biofuels has been started in Lappeenranta.

Local investments and expertise can also be used in a completely new business environment, good examples of which include business premises and related services provided by UPM to entrepreneurs in Kajaani and Kouvola, and the provision of forest management services to an increasingly larger group of investors.

A certain amount of the corporate income tax paid by UPM in Finland is divided according to regions where the company has significant operations, for example Lappeenranta, Jämsä, Kouvola, Rauma and Tampere. In addition to this corporate income tax and property tax paid by UPM, the taxes paid by the company’s own employees and indirectly-employed contractors increase the tax revenue of the regions. The taxes are used to finance common services and projects, with the purchasing power of UPM and its employees also adding to the vitality of these regions.

UPM Biofore

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