White plates and a cup and silver cutlery and salt and pepper cellars on a marbel table.

Tax strategy and tax footprint

Altia is a responsible taxpayer in all its operating countries (Finland, Sweden, Norway, Denmark, Estonia, Latvia, and France). In addition, the company aims to promote the Group’s strategic development and support business operations, as well as ensure their proper implementation also from the tax perspective.

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The management of tax-related matters is centralised at the Group level, where tax-related decisions are made. In ambiguous situations, the Group consults tax advisors and verbal or written guidance may be sought from the tax authorities to clarify tax practices.

It is important for Altia to comply with all applicable local and international laws and regulations in paying, collecting, remitting, and reporting taxes. The principle is to pay taxes in the country in which the income is earned. Altia does not operate in tax havens as defined by the OECD*, and the company does not practice tax planning aimed at artificially decreasing the taxable profit of the Group or an individual operating country.

As regards transfer pricing, Altia complies with local laws and the OECD transfer pricing guidelines. The arm’s-length principle is applied to intra-group transactions relating to products, services, intellectual property rights and financing.

Altia pays and remits several different taxes, with the excise tax being the most important. Excise taxes are not included in the company’s reported net sales. In addition to income tax, the taxes paid by Altia include employer contributions and real estate taxes. In addition to the excise tax, the most important taxes remitted by Altia include value-added tax, withholding taxes deducted from wages and salaries, and taxes at source.

Altia follows the guidelines issued by the Finnish Ownership Steering Department in the Prime Minister’s Office for country-by-country tax reporting of state-owned companies. Altia's tax footprint, a summary of taxes and contributions, in accordance with the guidelines, is published as a part of Annual Report. The summary is based on information collected from the Group’s accounting systems and includes the material taxes and contributions grouped by tax type.

Pursuant to the guidelines, Altia applies the materiality principle in its tax reporting. Accordingly, country-specific information on taxes is presented for Finland and Sweden. They constitute the company’s main markets, with approximately 80% of its net sales coming from these two countries. Altia’s other operating countries (Norway, Denmark, Estonia, Latvia, and France) do not meet the materiality threshold of 10% of consolidated net sales for countries to be reported on separately and are therefore presented collectively.

* According to the OECD, a tax haven is a country or jurisdiction that imposes nominal taxes or no taxes at all, is not willing to participate in international exchange of information, does not require companies registered in them to actually engage in business operations in their area, and is lacking in transparency.

Altia’s tax footprint, data for the financial year 2018:

 

Data for the financial year 2018

 

Data for the financial year 2017

 

TOTAL

Finland

Sweden

Other countries

 

TOTAL

Finland

Sweden

Other countries

Taxes paid  for the financial year, EUR million

 

 

 

 

 

 

 

 

 

Income taxes

8.0

3.6

3.4

0.9

 

4.4

1.4

2.1

0.8

Real estate taxes

0.3

0.2

0.1

0.1

 

0.3

0.2

0.1

0.0

Employer contributions

11.1

7.6

3.3

0.1

 

11.6

7.5

3.9

0.2

 

 

 

 

 

 

 

 

 

 

Taxes collected for the financial year, EUR million

 

 

 

 

 

 

 

 

 

Value added taxes, sales

229.6

116.94

72.2

40.4

 

240.5

122.2

76.9

41.5

Value added taxes, purchases

79.0

44.82

21.4

12.8

 

84.0

47.2

22.4

14.4

Excise taxes

444.3

239.2

131.1

74.0

 

445.5

234.5

142.3

68.7

Payroll taxes

11.9

7.6

2.0

2.3

 

12.7

7.5

2.4

2.8

Any other taxes (incl. withholding taxes)

1.0

0.0

0.9

0.0

 

0.8

0.2

0.6

0.0

 

 

 

 

 

 

 

 

 

 

Net sales by country, EUR million (local)

411.0

239.3

95.0

76.6

 

414.9

235.6

101.0

78.3

Profit/loss before taxes by country, EUR million (local)

Local

18.6

2.8

2.6

 

Local

31.5

5.6

2.5

Personnel by country**

678

402

114

162

 

703

411

117

175

The table contains the most significant taxes and tax-like fees, which the company is liable to pay or collect in accordance with the local legislation. Other countries' (Norway, Denmark, Estonia, Latvia and France) figures are presented collectively, because individually they do not meet the materiality threshold of 10 percent of consolidated net sales.

**Situation on December 31, 2018