Alliance row over property tax

New splits have emerged in Sweden’s opposition Alliance, as the Moderate Party slammed the Christian Democrats’ plans to abolish proerty tax.

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The disagreement follows a row earlier this week about the Liberal and Centre Parties.

In an opinion piece in Svenska Dagbladet on Friday, Moderate leader Fredrik Reinfeldt said he did not agree with the Christian Democrats’ plans to replace property tax with a local council charge.

Christian Democrat spokesman Mats Odell said Reinfeldt’s comments were an unexpected and surpising attack, particularly given that the Alliance’s joint economic policy group is scheduled to discuss the issue later in the spring.

He put Reinfeldt’s attack down to the fact that his party’s proposals had provoked a big reaction, including among Moderate sympathizers.

“I know that there is a lot of pressure in Moderate circles to adopt our proposal,” he said.

“We reject this system that charges tax on a non-existent profit. Reducing tax by a tenth or so and a forest of ceilings and limiting rules do not reduce people’s disquiet,” he said.

Earlier this week, the Liberal Party (Folkpartiet) and the Centre Party had a public spat over the latter’s agreement with the Social Democrats over energy policy.

Tommy Möller, professor of politics at Stockholm University, said that more disagreement between the parties was inevitable between now and the election, however much they try to streamline and coordinate.

“The down side of the alliance concept is that every little crack in the facade is put under the spotlight, and at the same time they are competing for votes.”

Möller has looked at various European studies. In all European democracies, floating voters are becoming more common, but they are moving mainly between parties in the same bloc.

Cannibalism between Sweden’s centre-right parties, where they take votes from each other rather than from the Social Democrats, Left and Green parties, is a perenniel Swedish problem.

The Moderates have tried to break this pattern by focusing on the centre ground to attract voters directly from the Social Democrats.

“But at the same time they have to win and retain voters from within the Alliance - you can give that up,”said Möller, adding that he thinks this could lie behind the Moderates’ positioning on property tax.

“The Moderates no longer prioritize property tax. They probably see a potential source of voters threatened.”

Swedes who own a house have to pay one percent of the notional value of the property in tax. The amount they pay is capped at five percent of their household income.

Critics of the tax says it hits people whose houses may have gone up in value, despite the fact that their incomes have not risen at the same rate.

The Moderates want to be able to include second homes when calculating whether their property tax should be capped at five percent of their income. They also want to reduce the percentage of the value of their house value that householders pay, cap the total amount of tax for which people can be liable and freeze the notional values on which the tax is based.

The Christian Democrats want to abolish the tax and replce it with a council charge to pay for road maintenance, parking, emergency services and town planning. The maximum tax on a villa would be 2,800 kronor a year, while people in apartments would pay a maximum of 900 kronor a year. They would increase capital gains tax on the sale of houses and condominiums to 30 percent.

TT/The Local