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National Pension Service |
[Alpha Biz= Reporter Kim Sangjin] On August 12, the National Pension Service (NPS) announced that it has won a lawsuit against the Finnish tax authorities, leading to the recovery of approximately 9.6 billion won in withholding tax on dividend income. This tax pertains to dividends earned from investments in Finnish stocks.
Withholding tax is the tax deducted at source on dividend payments made to foreign investors, which is paid to the local government by the company distributing the dividend. The NPS had claimed a refund of this tax for dividends received from 2014 to 2023.
The NPS anticipates that this victory will result in annual savings of around 3.8 billion won, based on figures from the previous year. The lawsuit was initiated after the NPS filed for a refund of the withholding tax under the European Union’s non-discrimination provisions, which mandate equal treatment of foreign institutions similar to domestic entities. Despite initial refusals by the Finnish tax authorities and the tax dispute resolution board, the NPS proceeded with legal action in a Finnish administrative court in 2022.
Alphabiz Reporter Kim SangJin(letyou@alphabiz.co.kr)
