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Alliance touts tax cuts in election manifesto
Björklund, Hägglund, Olofsson and Reinfeldt unveil election manifesto, Thursday

Alliance touts tax cuts in election manifesto

Published: 26 Aug 2010 12:49 GMT+02:00
Updated: 26 Aug 2010 14:43 GMT+02:00

The ruling Alliance coalition has promised its fifth in-work tax credit if it wins the election next month, it promised as it rolled out its manifesto on Thursday.

In addition, it would also give everyone the right to work until the age of 69. The amount of promised investments outlined totals 12.8 billion kronor ($1.72 billion).

The four party leaders presented their election manifesto at Färgfabriken in Stockholm to a large gathering of media.

Just as the Moderates had proposed earlier, they have pledged an in-work tax credit that will cost 12 billion kronor and a layer height limit for government taxation that will cost 3 billion kronor.

"The Alliance is presenting its job manifesto," said Prime Minister Fredrik Reinfeldt. "We have kept our previous promises to the Swedish people. The election will be about preparing ourselves and then getting it done."

He added, "We have also led Sweden through the worst crisis and come out of it and are going to the polls to discuss what we can possibly do with the growing surplus."

A good election campaign should be about important social problems, Reinfeldt believes.

"We must continue to try to achieve full employment," he said. "There is much to do there."

Regarding the budget for its campaign pledges, Reinfeldt described it as "clear," adding, "We do not promise more than we can keep."

In terms of other employment issues, the Alliance also wants more people to work on after retirement age. It would grant workers the right to remain employed until 69 instead of the current limit of 67.

Centre Party leader Maud Olofsson pointed out the importance of having a job as the fundamental element of human self-esteem.

"In order to have a jobs, there must be companies," she said. "We have given incentives to more people to run businesses and made sure that we have a security system that is equitable for both employees and entrepreneurs. The policy must continue."

Olofsson added the coalition would continue selling off state-owned companies. TeliaSonera, Nordea and SBAB top the Alliance's for-sale list.

"We want to remain the largest shareholder in Vattenfall, but we are also open to taking in new responsible owners," she said.

However, mining company LKAB remained state-owned. In addition, no changes will be made to the state's ownership of Apotek.

Liberal leader Jan Björklund pointed to increased competition and the need to make schools better.

"The Chinese have taken over Volvo, AstraZeneca is cutting in Sweden and even if we come out of the crisis, there will also be competitors there," he said. "To be successful in the next generation, we must elevate the quality of the Swedish educational system, he said, pointing to the efforts made by the Alliance.

He added, "The wall between school and working life has been too high. We want to move to a European model of apprenticeship and trial periods. That grades are falling in middle school is important and should be supplemented by national tests in grade six."

There will also be an evaluation of school municipalisation conducted in 1991. However, any proposal to renationalise the school will not happen in the next term of office because parties do not agree on it, said Bjorklund.

The Alliance has also made decided that carbon taxes need not be raised in the next government, said Olofsson. However, it would increase taxes on tobacco and alcohol.

Taxes specific to cigarettes would increase 8 percent, resulting in 700 million kronor in income to the public treasury. Tax on alcohol would increase 13 percent and include beer and wine, bringing in 1.1 billion kronor.

The Christian Democrats also pushed through one of their major concerns. There will be a tax credit for donations during the term of office costing 300 million kronor.

The Social Democrats' economy spokesman, Tomas Östros, slammed the Alliance manifesto. It was, he claimed "a cold manifesto."

"There's very little welfare and a lot of tax cuts," he said.

"The differences are now crystal clear and this will be a tough fight. This is tax cuts - especially for those who earn most - set against welfare."

TT/The Local (news@thelocal.se)

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Your comments about this article

15:14 August 26, 2010 by Taxalien
It is a completely pointless document. It will change absolutely nothing for the majority of Swedes.
15:59 August 26, 2010 by RobinHood
Unless you work, don't work, want to work until 69, pay tax, run a business, go to school, drink or smoke.
16:26 August 26, 2010 by miss79
cut this tax, cut tat tax, alliance-crazy goverment!!
16:28 August 26, 2010 by Great Scott
You must ask yourself who is paying for this.
18:10 August 26, 2010 by 2394040
Sweden continues to move more and more in the direction of the USA. Where the rich get richer, and I'm sure you can guess what everyone else gets.
20:02 August 26, 2010 by here for the summer
this is good for Swedes and Sweden ..
22:04 August 26, 2010 by shinnam
George Bush ran on tax cuts as well.
22:44 August 26, 2010 by d_s
Plus ca change.. I am sure that one thing will not change - Sweden will be taking more debt for the enjoyment of the future generations.

Its funny how people would condemn irresponsible behaviour with money when it comes to individuals (say, Jack likes to live large, and spend more than he makes - his children will pay when he is dead), but not when it comes to political parties. On the contrary, all the politicians talk about is what you are going to get. That's what gets the vote. Countries act like private corporations: they hold a part of their capital as debt. All is usually well, as long as the economy continues to grow. If not, its a mortal situation.

If someone would propose to change this, I am sure we would have panicky economists crying in the media that the whole system will come down unless everybody owes everybody else and no one can pay :)

Debt makes the world go round.
23:58 August 26, 2010 by Luke35711
People overestimate the impact of such policies one way or the other. The truth is, it does not matter much. What matters is local culture. Swedish egalitarian and communitarian values served it well economically after WW2, but it no longer works. The same thing happened in Japan. Settle down for cold dark winters, boring summers, many decades of stagnation and high unemployment.
07:48 August 27, 2010 by Byggare Bob
Sweden is doing well despite paying the highest marginal taxes in the world.

This government has eased some taxes but it is hardly acting irresponsibly or living beyond the country's means. Sweden has never been a "socialist" country, simply a largely market system with higher than average taxes.

While Sweden, like all others, has evolved since the end of the Cold War, there remain far more alternative models available than the one proffered by the USA - perhaps some of the commentators on this site would do well to remember that. It really isn't USA or bust, we are doing fine thanks.

This is why the centre-right gov. is popular in the polls and likely to win the election - both nationally and in Stockholm (where a full 25% of the population live. It is not an aberration for Swedes to vote centre-right - almost (and now just over) half have pretty much always done so.
08:12 August 27, 2010 by Kevin Harris
Good post Byggare Bob. Sweden seems to be doing OK and attracting international economist admirers for the Moderates deft handling of the economy during the recession. More of the same seems reasonable.

Adjusting the tax system downwards to meet market conditions is not necessarily a switch to a US style system. Market conditions sometimes demand tax decreases, and sometimes tax increases, it depends on what's going on at the time. A well-run governing party has the ability to go either way, unfettered by political dogma that might prevent it from doing the right thing for the country. I can't imaging the Left Party ever being able to raise taxes, even if conditions where crying out for that; another good reason not to vote for them.

Similarly, the welfare state needs occasional adjustments too. The overall influence is "How much can we afford?", but social engineering plays its part too. As society changes (and Swedish society is going through fundamental changes), welfare has to change to meet the new conditions. In some areas more generous, and in others less. Once again a good governing party must have the flexibility to make those necessary changes without pandering to political dogma preventing it from doing the right thing.
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