Finnish, Estonian tax administrations start real-time data exchange

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Tax declaration. Source: Aili Vahtla/ERR

Estonia and Finland have started to exchange real-time data, a world-first for the automatic exchange of information between national tax administrations.

In the past, information has been exchanged between the Estonian Tax and Customs Board and the Finnish Tax Administration but only through manually processed requests.

The new system will enhance tax control, save resources and improve the quality of services offered to customers.

Since January 2021, Finland has received real-time information on tax debts from Estonia. This year, the tax administrations of both countries will launch further secure real-time exchanges, extending to VAT information as well as labor and social tax information.

The information is exchanged via X-Road. Cooperation will continue in the future and more services will be opened in the coming years.

Although the exchange of similar information has been possible in the context of traditional information exchange, real-time information exchange enhances the investigation of cross-border tax offenses and allows for more effective cooperation.

The aim is also to improve customer service, for example, in the future an Estonian citizen working in Finland will not have to come to the Estonian Tax and Customs Board to apply for a certificate about Estonian wages for the Finnish Tax Administration.

"The fact that we have achieved this breakthrough with our Estonian colleagues is a result of an excellent long-term cooperation. We have now created the technical solution, but the basis of this is actually built on mutual trust, that has enabled us to reach a new level and be the international forerunner together," said Arto Pirinen, strategy director at the Finnish Tax Administration.

Rivo Reitmann, deputy director general of the Estonian Tax and Customs Board, added that automatic data exchange will significantly enhance cooperation in the investigation of cross-border tax violations.

"Currently, inquiries between Estonia and Finland make up about a third of all inquiries from both countries. Real-time data exchange makes the work of both Estonian and Finnish tax administrations significantly easier and faster and is a leading example of good cooperation between tax administrations," Reitman said.

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Editor: Helen Wright

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