The Tax Administration’s logo at a tax office in Helsinki. Photo: Antti Aimo-Koivisto / Lehtikuva
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A government bill granting the Finnish Tax Administration wider access to bank account data has sparked strong resistance from financial sector bodies and legal experts concerned about privacy and data protection.
The proposal, now under review in Parliament’s Constitutional Law Committee, would allow the Finnish Tax Administration to request bulk transaction data from banks without linking those requests to named individuals. The new powers are intended to improve the fight against undeclared income and financial crime.
Under the current system, the Tax Administration may request specific financial data related to individual taxpayers under certain conditions. The proposed change would permit data collection based on perceived risk phenomena, such as platforms generating hidden income or inheritance and gift tax violations.
According to the government, the law could increase annual tax revenue by up to €100 million by 2028. The initial growth is expected to range between €50 million and €80 million in 2027. However, the Confederation of Finnish Industries (EK) has dismissed the estimates as unrealistic, suggesting a more likely outcome would be around €10 million annually.
Finance Finland ry, the representative body for the banking sector, has labelled the reform disproportionate and legally questionable. In its submission, the association compared the proposed system to allowing police access to all citizens’ telephone records without targeted suspicion.
“Currently, inspections focus on a specific person or company’s financial activity. With mass data collection, the Tax Administration would also access information unrelated to taxation,” Tuulia Karvinen, legal adviser for Finance Finland told Ilta-Sanomat.
Finance Finland argues that large volumes of irrelevant personal data would be collected, including information on individuals’ health, religious contributions, and political donations.
“If banks were required to hand over all transactions to verify gift tax thresholds, they would also be transferring sensitive personal information not necessary for tax purposes,” Karvinen said.
Data unrelated to taxation would still be retained by the Tax Administration for two years under the bill, a practice critics describe as excessive. Privacy advocates, including Finland’s data protection ombudsman, have also raised concerns about the breadth and proportionality of the measure.
In the proposed model, the Finnish Tax Administration would define the risk criteria justifying a request. Critics argue this hands too much discretionary power to the agency itself.
“Justification for proportionality appears to rely entirely on the Tax Administration’s internal assessment,” said the Confederation of Finnish Industries in its statement.
The Constitutional Law Committee, chaired by Heikki Vestman, began reviewing the draft on Tuesday. The committee is expected to consult several legal and privacy experts before issuing an opinion next week on whether the proposal aligns with Finland’s constitutional safeguards.
According to the Finnish Constitution, bank records are protected under the right to private life. Legal experts argue that accessing citizens’ financial histories en masse without targeted grounds may breach these protections.
While the Tax Administration supports the bill, it has acknowledged that irrelevant data could be collected during bulk screening. In its justification, the agency stated it cannot disclose risk models in detail due to operational sensitivity.
Financial sector representatives say the bill undermines public trust in digital financial services, especially when fraud and cybercrime are already rising concerns. According to the Banking Supervisory Council’s 2024 report, digital fraud has increased in both frequency and sophistication, prompting calls for updated regulatory tools focused on prevention and information sharing.
Finance Finland has emphasised that effective tax supervision should rely on targeted, proportional requests rather than broad surveillance.
HT
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Source: www.helsinkitimes.fi
