The government decided last summer that value-added tax rates would be raised by one percentile from July this year.
VAT is a consumption tax which is paid when buying goods or services. The current VAT rate is 22 percent, and 12 percent for foods. There are also separate VAT rates for books, medicines, and culture services.
“The government is making the wrong decisions. If the actions that have been previously planned are approved, I feel that it will have a negative impact, because the prices of goods and services will rise. The rise in prices will affect consumption, and it will also have an impact on economic growth”, Urpilainen said in the interview.