Customs duties have been collected since the 13th century
The collection of customs duties in Finland is connected to our common history with Sweden. It also has to do with the emergence of cities and with the development of trade. The first cities in Finland were founded between the 13th and 15th centuries. These were Turku, Viipuri, Porvoo, Ulvila, Rauma and Naantali. At the same time the Hanseatic League began to loose its trade hegemony in the Baltic.
There is, however, very little evidence from that time about the collection of customs duties. It was
not until during king Gustav Vasa in the 16th century that a permanent public administration was established and
customs duties became important. In general, the concept of "foreign trade" gained importance.
Almost 200 years of Finnish Customs
Almost 200 years ago, on February 12th 1812, the Russian emperor Alexander I approved the regulation for the General Customs Directorate of the Finnish Grand Duchy. In 1885, the name was changed to Board of Customs. According to the regulations given in 1812, the supervision of Customs belonged to the government of the Finnish Grand Duchy while the General Directorate was in charge of the administration and of the implementation of regulations. The Directorate was responsible for the customs collection and accounting as well as for the calculation of the balance of trade, and for the supervision of the activities of the customs houses.
The Customs of the Grand Duchy was developed mainly for the needs of the country itself and therefore no big changes were necessary when Finland became independent in 1917.
The establishing of a Board of Customs and of other central agencies was a very good solution for the
later development of the country. Such a proper administration strengthened the internal administration of the Grand
Duchy of Finland and paved the way for the independence of the country. Proper Customs is distinctive for every
independent state. Therefore it is without exaggeration that we may say that during the18th century Finnish Customs
constituted a corner stone for the future independence.
The customs duties' share of the tax revenue has fluctuated much
The customs duties' share of the total state tax revenue and tax-related revenue was barely one fifth at the end of the 1830ies, but already in the 1850ies it was more than 40 percent of the state tax revenue. Until the 1930ies the customs duties formed the backbone of the Finnish state economy. After the customs duties went down and were abolished to a large extent from 1950 onwards, the fiscal importance of the customs duties has decreased. Nevertheless, Customs is still an important institution for collecting taxes, since it collects VAT and other taxes from foreign trade.
The long history of Customs in Finland is in many ways intertwined with the different phases of the Finnish economy and of the development of the state. Customs was established and has developed in order to reach the goals strived for through taxation, regulation and control of the foreign trade through centuries. The goals have changed with time and Customs has changed accordingly. The transition from the Russian Grand Duchy to an independent state was smooth, and joining the European Union customs system in the 1990ies was easy.