Finland's mining industry has launched strong criticism against Prime Minister Petteri Orpo's government over proposed mineral tax increases that companies claim threaten billions in investments and thousands of jobs. The controversy centers on Finance Minister Riikka Purra's proposal to raise the metallic mineral tax from 0.6% to 2.5% and increase other mineral taxes from €0.20 to €0.60 per ton.
Industry leaders delivered sharp warnings during a major mining company event in Helsinki. Matti Hietanen, CEO of state-owned Finnish Mineral Group, described the government's approach as reckless. "Mine lifecycles will shorten and mining operations will shrink," Hietanen stated, capturing the sector's growing frustration.
The tax proposal comes after the government abandoned plans to increase candy and chocolate taxes following pressure from confectionery giant Fazer. The mining industry now appears determined to replicate this successful lobbying effort, using their substantial economic leverage to push for modifications.
Finland's mining sector plays a crucial role in Europe's strategic mineral independence. The country participates in six strategic EU projects aimed at securing critical raw material supplies by 2030. Industry representatives argue the tax changes directly contradict these European objectives. "Finland is now moving in a completely different direction than the rest of Europe," Hietanen noted during his presentation.
The economic stakes are substantial. Mining companies plan over €10 billion in investments during the next decade, but industry estimates suggest two-thirds could be canceled if the tax changes proceed. The negative cost impacts for operating companies range between €147-250 million annually, affecting mine lifecycles, profitability, and Finland's attractiveness as an investment destination.
Specific projects already feeling the pressure include Terrafame's mine, which could see its remaining operational life shortened by 4-8 years. The Kemi chrome mine faces a 5-year reduction, while Kittilä gold mine's remaining 13-year lifespan would shrink by two years. These operations collectively employ thousands directly and support additional indirect jobs in their regions.
The industry proposes an alternative hybrid model featuring a fixed, royalty-based portion entirely allocated to municipalities and a state share based on net mining production income. This approach would provide municipalities with stable, increased tax revenue while maintaining neutrality for the state and protecting jobs and future investments.
Companies emphasize that the current tax model creates particular hardship because mines must pay mineral taxes even during loss-making years, as the levy represents a direct additional cost based on final product output rather than profitability. This structure becomes especially problematic during price downturns common in the cyclical mining industry.
The tax proposal is currently under consideration by Parliament's Finance Committee, which will prepare a report for full parliamentary decision. The government argues current tax levels are too low and aims to increase mineral tax revenue by €70 million annually starting from 2026. Mineral taxes first collected for 2024 generated approximately €31 million in revenue.
The outcome will significantly impact Finland's position in the European critical minerals landscape and determine whether the country can capitalize on its geological resources while maintaining competitive conditions for international mining companies.