VAT Talks - Tiina Ruohola



In this week’s blog post, we had the pleasure to discuss VAT with Tiina Ruohola. Tiina is Senior Adviser Indirect Taxes at EK - Confederation of Finnish Industries and in that capacity also member of the VAT Expert Group. Learn everything about e-invoicing in Finland and what she believes is a correct balance regarding data sharing with the tax authority. She rightfully states that “all information required should always be reasonable and actually used, not just collected.” Additionally, we discussed the importance of a dialogue between decision-makers and the business community. Lastly, Tiina explains why she has such a passion for VAT and why the world will be your oyster if you choose for VAT!

Could you tell us a bit more about yourself, for how long you have been working in VAT and how you ended up in this field of work?

“I have been working with VAT since 2005 so I have been in this field for more than 15 years. At the beginning of my career, I was very much involved in VAT refund applications – both 8th Directive and 13th Directive. I loved it as it made it possible for me to be utilizing two of my passions – numbers and languages.

I have always loved travelling. For me working with VAT was international from day one. I remember being extremely interested in understanding the different regimes that we had within the EU and I was always thinking about the different reasons behind e.g. input VAT deduction rights. In addition, when applying for VAT refunds from different countries it became obvious from very early onwards that even within the EU we did have – besides the different rules - also very different cultures in which the tax administrations work. I found that fascinating, almost like travelling without leaving the country. I knew immediately that I wanted to be working in the field where I could be involved with people and matters from different countries.

Back to the first question, how did I end up in the field, I guess no-one has dreamed about becoming a VAT specialist as a child. I was dreaming about becoming a singer or an actress. The ones that have heard me speak in public about VAT know that in a way I still see myself as a star when explaining about an interesting tax question. I have been told that my passion about the topic is visible to everyone hearing the story – and maybe that is because of my artistic character – in addition to the mere fact that VAT is something that everyone can get extremely excited about, right?”

You work for the Confederation of Finnish industries and are a member of the VEG, could you tell us a bit more about your work?

“I have been working for the Confederation of Finnish Industries for the past 3.5 years after having worked with two Big4 firms and the Finnish Tax Administration. The Confederation of Finnish Industries is the leading business organization in Finland. Our main task is to make Finland an internationally attractive and competitive business environment. Successful business activities are the foundation for the Finnish welfare society.

I am the only person responsible for VAT and other indirect taxes in Finland. I work along with my two excellent colleagues in a tax team of three – they are responsible for the direct taxes. What my everyday work consists of is very wide. When there are domestic changes in VAT legislation, the Parliament asks us about how the business community sees the changes. In a way, one could call me the voice of Finnish business towards the Members of the Parliament. I also work very closely with the Finnish Ministry of Finance. We are often asked our opinions about the upcoming legislation already when the proposals are being drafted. In addition, we try to give our own ideas to the Ministry about the changes that the business community would welcome. I value extremely highly our open and honest discussions with the Ministry of Finance. Being a smaller Member State living on foreign trade, we need to think about what is good for the whole Finland and never look for short-term gains. Cooperation is the key.

In addition, I work closely with the Finnish Tax Administration and comment on their draft written guidelines that are being published on the website of We have also been able to influence and get more of the guidance available in English as well. Everything is in the two national languages of Finland; Finnish and Swedish but we are glad to see the need for the English guidelines as well.

I am also in the Board of Adjustments, which is the first instance for which you appeal against your VAT decision. In other words, all VAT related differences of opinions between businesses and the Tax Administration end up at my desk. Together with the Chairman and the representative of the Tax Administration, we consider the adjustment requests. I am also a part of the Central Board of Advance Rulings where we give advance rulings on major VAT questions.

To conclude, the work on the domestic level is very diverse and no two days are the same! What I really enjoy, though, is that the work also has an international aspect. I have been very thrilled about having the possibility to work as a Member of the VEG. This is a great opportunity to hear about the upcoming plans of the Commission as well as to express the views of the businesses. I think the Commission’s willingness to hear business’ perspectives and to try to evaluate the out-comings of new legislation beforehand in cooperation with stakeholders is of great value to the EU. I truly and wholeheartedly believe that cooperation is the only way forward and that in the long run our success depends on how well we can cooperate. I think having representatives from different countries adds value as well, as the EU is for all of us.”

Finland has a very well developed e-invoicing system, could you tell us a bit more about how it works, how it achieved such a high adoption of e-invoicing and what its benefits are?

“Finland has a long history with e-invoicing indeed. The first e-invoices started going around in Finland already in the last century. When the e-invoicing Directive came into force in the EU, Finland was actually implementing it with a wider range than the Directive obliged. As of 1 April 2020, also B2B buyers have been able to demand an e-invoice that is compliant with EU invoicing standard, i.e., they have the right to receive such invoices, if they so request.

Due to the long history of e-invoicing, e-invoices are very widely used in Finland in B2B transactions. This of course has enabled more efficient handling of invoices for many businesses meaning significant cost savings.

We, however, are far from being ready in Finland either. Work is being done at present also to examine how and which steps we should take to move towards a more real-time economy. In Finland we believe that digitalization can further bring great benefits for the whole country as well as the whole EU. Cooperation is needed also in this to take steps that take into account the different needs of different kinds of businesses. EU-wide co-operation could also be bringing great benefits for the whole continent. Many of our businesses operate in multiple EU-countries. Different systems in all different countries raise the costs of EU businesses, making them concentrate on just being compliant rather than on issues that bring greater good, such as generating growth and fostering new businesses in a sustainable way.”

Concerning real-time reporting, will Finland consider the implementation of a real-time reporting system for domestic transactions?

“We have had discussions ongoing in Finland about the next steps for how and what kind of information should be reported in Finland. Currently, the companies submit their VAT returns on a monthly basis, but there are no real-time reporting obligations such as in some other EU Member States. I think what needs to be thought here is what is a good balance – what information would actually be good to have and what information is merely something that would be nice to know. If the nature of the information to the Tax Administration is merely something that would be nice to know, it is difficult to reason why would the businesses need to invest and spend money on providing this information. One should always remember that providing any information always costs money. Consequently, all information required should always be reasonable and actually used, not just collected.

Will Finland in the end consider the implementation of a real-time reporting system for domestic transactions? This remains to be seen, of course. Personally I believe that this decision cannot be made quite yet. We need further information and a lot more communication and discussions between all the stakeholders to understand where and why we would want to be going as a country. Anyhow, I strongly feel that domestically no decisions should be taking place on this matter. What we need, also at this point, is EU-wide consensus on the way forward. Different national real-time reporting systems only harm the competitiveness of EU businesses.”

You are writing your PHD thesis on VAT, can you tell us more about the topic and why it is important?

“We all have our hobbies, right? One of mine is value-added taxation as I do not get enough of it during my days at work. A bit more seriously, I indeed started my PhD work in the field of value-added taxation last year. I am of course still quite early in the process. My work will concentrate on the outside of scope activities and what the impact of these activities should be in the input VAT deduction rights. I want to examine and research what the original plan was with the legislator and how the concept of outside of scope activities has changed. I am slightly worried that at times the brilliant idea of VAT might be forgotten. The right to deduct input VAT is a fundamental part of the whole system. I hope my research will give some further insight to this very basic question of VAT.”

We read that your first job concerned berry picking, are there any transferable skills between berry picking and being a VAT expert?

“I am proud to have been working in berry picking. I am also proud to have been working as a cashier, in a postal office, assembling Nokia phones in their prime years, marketing Pringles when they first came to Finland and so many more different kinds of jobs. I believe that all of them have taught me and have influenced me as a person and as an employee. I think it is extremely important for young people to have their first work experiences as soon as they are no longer children. The concept of earning your own money is a key in understanding how the economy works.

What I really learned in berry picking was patience. When I thought that the job was already done, I got sent back to the field. It felt like I really had to push myself to start again. There were times when I felt like quitting but I did not. I went there and started over. And in the end, I got my reward. When you think about the qualities that a good berry picker has, many of them are the same for a good lobbyist. If someone shoots your idea down, you should keep on going if you believe in your story. It might be painful at times and there may be times when you are disappointed when you think that the job was already done and you find out that it was not. The most important thing is to keep going and not give up. Last but not the least, it was the other people in the berry picking fields that were a great joy and encouragement – the same goes for the VAT world. Together we are more.”

What do you think the role of confidentiality is in the development of the solution to VAT fraud? Is it part of the debate?

“I think in the EU we often start talking about the VAT gap and the fraudsters. Maybe one of the aspects that is easily forgotten is that if we put extreme measures in place to catch the bad guys, the good guys are the ones paying the bill for the excess reporting obligations. Of course there needs to be efficient administrative co-operation between the tax authorities to reduce the possibilities of doing the wrong things and misusing the system.

In Finland, the VAT gap is and has been relatively low throughout the years. When the Finnish people or companies are being asked, we are actually happy to be paying our taxes. I think it comes down to the fact that we are positive about paying our taxes when we know what we are getting with the taxes.

The matters of culture do not change overnight, of course. I think, however, that we should examine within the EU which good practises we could take from one country to the other. I believe that focusing also on the good relationship between companies and tax administrations rather than only about extreme measures of furthering compliance regimes would be beneficial.”

You are advising the EC on a regular basis, but if you have to give them 1 piece of advice which they should implement immediately, what would it be

“Arrange more meetings with Member States and VEG at the same time, in the same room. The Commission is doing great work along with the Member States through the Group on the Future of VAT and great work with the business community through VEG. However, often a deeper understanding can be gotten when we are able to talk about the issues face to face. Hence, keeping mutual meetings would take the stakeholder work to the next level.”

Lastly, what would you say to people who are not really fond of VAT? How would you enthuse them for this form of taxation?

“Study your local CIT rules, you will be able to work in your country. Study the EU VAT rules, and you will be able to work everywhere around the globe. All EU Member States share the same background – the EU VAT Directive. In the US, many companies will be thrilled to utilize your knowledge about the EU VAT as their business is also taking place here. Many new systems, such as the ones in the Gulf region, share a lot of similarities with the EU VAT system.

Hence, if you want the world to be your oyster, choose VAT.”

We would like to thank Tiina again for her time and for giving her perspective on VAT. The opinions expressed in this article are personal. If you have any questions, suggestions or if you want to be our next interviewee, do not hesitate to contact us via