Vantaa has a healthy economy, the balance has strengthened, and we have managed to reduce our debt – we are ready for the future changes in our operating environment


Mayor of Vantaa, Ritva Viljanen, has published her 2023 budget proposal. The city’s fiscal consolidation has generated good results, and Vantaa’s economy now rests on solid ground. Vantaa has reduced its debt by €250 million and is currently one of the least indebted cities among Finland’s large cities. The wellbeing services county reform will change the city’s operations and economy, and the city's operating environment has already drastically changed after Russia attacked Ukraine. The economy—already recovering from the coronavirus (COVID-19) pandemic—is now suffering from strong inflation, rapid increase in interest levels, and threatened by recession. Vantaa will continue to balance its economy and, at the same time, make major investments in the city's growth.

Henkilöllä on kädessään tabletti, jossa näkyy ympyräkaavio. Taustalla on Vantaan kaupungintalo.

Figures in brief

The city’s and funds’ combined operating income in the 2023 budget amounts to €344.4 million, while the operating costs amount to €986.3 million. Compared to the 2022 budget, the operating income will diminish by 27.4% and operating costs by 46.7%. The reason behind these changes is founding of the wellbeing services counties and the related change in the city's budget structure.

Compared to the second 2022 interim report’s annual forecast, the income will decrease by 33.5%, and the costs by 48.5%. The above figures are not, however, comparable because of the wellbeing services county reform, which will enter into force on January 1, 2023. In addition, COVID-19-related costs and compensations were targeted at the city in 2022, but they are unlikely to be repeated in 2023.

Tax revenues and state contributions will cover around 80 percent of the city's operating costs in 2023, because the share of tax revenues will be higher than usual due to so-called tax tails (part of the tax revenues will be paid on the basis of the 2022 municipal tax rate, as well as on the basis of the distribution share of the corporation tax).

The annual margin of the 2023 budget is €161.2 million and the deficit for period is €51.8 million.

The wellbeing services county reform will change the city's operations and economy – growth will continue

The wellbeing services county reform will enter into force as of the beginning of year 2023 and it will have major impacts on not only the city's operational changes but also on the city’s finances. Removed from the city’s finances will be costs arising from social welfare, healthcare, and search and rescue operations, but cuts will also be made in tax revenues and state contributions. Furthermore, individual tasks—such as student welfare and rehabilitative work activity—will no longer be among the responsibilities of the city. Approximately 4,000 people, currently employed by the City of Vantaa, will transfer to the Vantaa and Kerava wellbeing services county.

“Promoting the residents’ wellbeing will remain a shared key task of both the City of Vantaa and the Vantaa and Kerava wellbeing services county, which means that the two organizations must focus on their joint partnering in the future,” says mayor Ritva Viljanen.

In the course of 2022, the coronavirus pandemic has weakened in Finland, and we have been able to lift the COVID-19-related restrictions. In February, Russia’s attack on Ukraine began, and it again changed the city's operating environment in one go. Decisive and fast recovery from the economic crisis brought about by the COVID-19 pandemic was replaced with new economic uncertainties as inflation drastically increased, for instance, because of growing energy prices and interest levels. The threat of recession has increased throughout Europe.

Vantaa’s population growth is estimated to continue. In 2021, Vantaa’s population growth amounted to less than 2,000 people, which is an exceptionally low figure for Vantaa. In 2022, the population growth is projected to increase and amount to approximately 2,800 people. As of year 2023, the population growth is forecast to strengthen. The building prognosis anticipates housing production to settle down to 3,000—4,000 housing units in the years to come. Population growth will present challenges to service production and investments also in the coming years.

The city's unemployment rate has clearly fallen since the early days of the coronavirus pandemic. In August 2022, Vantaa’s unemployment rate was 10.8%, which was 3.1% lower than the rate in the previous year. Before the coronavirus pandemic, Vantaa’s unemployment rate amounted to around 8.5%, which means that recovery from the pandemic is still going on. A special cause for concern is the number of the long-term unemployed, which only reached its peak at the beginning of 2022, before the decrease began.

“Vantaa as a growing city will systematically continue to balance its economy, while simultaneously investing in the goals compliant with its city strategy. The City of Vantaa’s operations will, in the future, focus on education, learning, culture, and vitality. Moreover, ensuring local involvement and democracy also constitutes an important task of the city,” Viljanen states.

The Education and Learning Department is the biggest of the city's departments; its share of the city’s employees surpasses 70 percent and its operating costs amount to more than half of the city's combined operating costs.

In connection with the wellbeing services county reformation, the municipal tax rates of all the municipalities in mainland Finland will be cut by 12.64%. Furthermore, municipalities’ corporation taxes will be cut by a third. The state contributions related to the tasks transferred to the wellbeing services counties will be cut from the municipalities. Nevertheless, the amount of state contributions will compensate for the changed situation in such a way that in 2023 there will be no changes in the balance of municipal finances. The final impacts of the reform will, however, be known as late as in the fall of 2023.

“Even through revenues and costs will be removed from municipalities basically to the same extent as in the transitional year, the municipalities will have more limited means to maintain a balanced economy  and investments due to diminishing volumes.

Vantaa’s balancing of the economy progresses as planned

The 2023 budget has targeted added resources to meet the increased service needs of, especially, education, early childhood education, and urban culture. Additional financing has also been targeted at goals consistent with the city strategy, for example, more investments in mathematics and the mother tongue instruction for children in grades 1 and 2. In addition, the €18-million sum, targeted at covering the service and healthcare debt caused by the 2021-2023 coronavirus pandemic, will increase the one-off costs in 2023 by a sum of €3.7 million. The city has prepared for the cost effect of the municipal salary solution with a sum of €20 million.

In early 2021, Vantaa compiled and approved the 2021-2025 productivity and growth program, which aims to improve the city's financial situation in such a way that the operational economy will be balanced with a surplus fiscal year in 2023. Balancing the economy will progress according to the productivity and growth program, while accounting for the one-off nature of the recovery plan. The aim is to annually increase the annual margin, so that in 2025 it will amount to at least €130 million, which means that the city’s basic investments can be carried out without having to resort to net borrowing. The 2023 result for period is estimated to be strongly positive, thanks in part to the one-off, so-called tax tails, that is, the case when part of the tax revenues will be paid on the basis of the 2022 higher municipal tax rate as well as on the basis of the distribution share of the corporation tax.

“The city’s long-term fiscal consolidation has generated good results, and Vantaa’s economy now rests on solid ground with a strengthened balance. Moreover, during the past six years, Vantaa has been able to pay back its debts by €250 million and is currently one of the least indebted big cities in Finland,” Viljanen states.

Substantial investments into the city's growth will continue

The City of Vantaa will next year have numerous important investment projects, the majority of which are targeted at new building and repair. In 2023, five daycare centers will be completed, contracted by the city and the group company. Planning of Vantaa light rail and Elmo swimming hall will continue. Vantaa Vocational College Varia’s investment project in Vehkala will progress, and a learning campus is being planned for Tikkurila, in addition to the big Jokiniemi project. Developing Kuusijärvi Recreation Center Vantaa into a major nature site will also continue. After a lengthy wait, Kivistö shopping and service center will be completed, and the city will transfer some of its services into the center.


The mayor's budget proposal will progress to decisionmaking. The city executive board is scheduled to give its budget proposal to the city council on November 1, and the city council is to decide on the budget on November 14.

Year 2023 key budget figures

  • population: 247,495 (Dec. 31, 2023)
  • deficit for period €51.8 million
  • income tax return: €64.9 million*
  • internal financing of investments: 101%
  • tax revenues: €2,465 / resident
  • operating costs: €3,985 /resident
  • loan portfolio: €3,335 /resident

*) exceptional due to tax tails A tax tail means that in 2023 part of the tax revenues will be paid on the basis of the 2022 higher municipal tax rate (19%)  as well as on the basis of the old distribution share of the corporation tax.

Proposed tax percentages

  • income tax percentage: 6.36*
  • public real-estate tax percentage: 1.28
  • permanent residential building: 0.41
  • other residential building: 1.25
  • power plant: 3.10
  • unbuilt building plot: 6.00

*) Due to the wellbeing services county reform, the municipal tax rate will be lowered by 12.64% and it will be frozen for the duration of year 2023.

Additional information:

Visit our website and read more about different departments’ highlights for year 2023. (to be published on October 3, at 16:00)

Further information on the budget proposal is available from the city council’s presentation on the Vantaa Channel. Live broadcast begins on October 3, at 16:00, and the recording will be published later on the Vantaa Channel (in Finnish) at:


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