Borenius advised Alva-yhtiöt Oy on the Mankala principle in taxation
References/3 Mar 2023
Borenius advised Alva-yhtiöt Oy on the Mankala principle in taxation
We advised Alva-yhtiöt Oy on tax issues concerning Jyväskylän Voima Oy, a key energy producer in Jyväskylä region operating under the Mankala principle.
The Mankala principle refers to a cost-price model used in taxation and applied especially in the Finnish energy sector. The model enables the shareholders of a power plant to receive electricity and heat at cost price when normally a fair market value should be paid.
We confirmed the application of the Mankala principle with the Finnish Tax Authorities in connection with an arbitration settlement, including pre-emptive discussions on income tax and transfer tax as well as an advance ruling process for VAT.
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