[World Tax News] Finland to Introduce Tourist Tax to Boost Local Revenue and More

Editorial Team – [2026] 185 taxmann.com 754 (Article)

World Tax News provides a weekly snippet of tax news from around the globe. Here is a glimpse of the tax happening in the world this week:

1. Finland to Introduce Tourist Tax to Boost Local Revenue

The Finland Ministry of Finance has evaluated the feasibility of introducing a tourist tax. Following a preliminary report and stakeholder consultations, the Government has decided to commence legislative drafting.

The proposed tax would allow municipalities in popular tourist destinations to generate additional revenue from tourism, with adoption left to their discretion. It would apply to short-term paid accommodation for both domestic and foreign travellers, ensuring equal treatment across accommodation types. The objective is to offset tourism-related municipal costs through a simple and clear tax model.

As a new levy, it will require enactment through legislation specifying the conditions for adoption. Tax proceeds will remain with the respective municipality. The tax is expected to be a moderate percentage of accommodation charges, with details to be finalised during drafting.

The Ministry has initiated drafting, and a proposal will be released for public consultation via Lausuntopalvelu.fi. If enacted in 2027, municipalities may implement it from 2028. No pilot project is proposed.

2. Australian Tax Office Updates Transfer Pricing Compliance Approach for Inbound Distribution Arrangements

On 23 April 2026, the Australian Taxation Office (ATO) published an updated Practical Compliance Guideline (PCG) setting out its compliance approach to transfer pricing issues arising in inbound distribution arrangements. The updated PCG builds on PCG 2019/1, which the ATO originally issued in 2019 and which introduced a risk-rating framework for assessing the transfer pricing risk profile of foreign-owned entities distributing goods in Australia. The 2026 update reflects evolving market conditions, updated benchmarking data, and operational lessons learned since the original guideline came into effect.

The ATO assesses the transfer pricing risk of inbound distribution arrangements by comparing the profit outcome—measured as earnings before interest and tax (EBIT) relative to sales—against industry-specific profit markers. Arrangements that fall within the designated “green zone” (low risk) are generally not subject to ATO compliance activity. A new “white zone” has been introduced in the updated PCG, providing a safe harbour for certain taxpayers that meet specified criteria, offering an additional tier of certainty for compliant arrangements. Arrangements falling in the higher-risk “red zone” remain subject to priority review and potential audit.

The updated guidance is of significant relevance to the many multinational groups that distribute goods into Australia through related-party arrangements with foreign manufacturers or principals. Transfer pricing in this context is a perennial area of ATO focus, and the refresh of the compliance framework signals continued scrutiny. MNE groups with inbound distribution arrangements in Australia should review their EBIT margins against the updated profit markers, assess their zone classification, and consider whether contemporaneous transfer pricing documentation adequately supports their pricing outcomes in line with the arm’s length standard.

Source – Australian Taxation Office

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