Government plans to cut property tax

The Local
The Local - [email protected] • 29 Mar, 2006 Updated Wed 29 Mar 2006 10:36 CEST

The Swedish government's spring budget negotiations with its coalition partners, the Left Party and the Green Party, begin on Wednesday amid rumours that a cut in property tax is planned.


According to Svenska Dagbladet, finance minister Pär Nuder wants to reduce the tax paid by owners of houses. That currently stands at 1% of the taxable value of the home, a figure based on a range of factors, such as size, age, condition and proximity to water.

The Left Party is said to be positive towards the cut, after the taxable value of small houses climbed by an average of 23% in the last 12 months.

Two weeks ago Nuder forecast strong growth for the economy and said that it would allow the government to invest in the young and the old, with more job creation schemes and benefits for the elderly.

In the autumn the government and its partners set out a principle that nobody should pay more than 4% of their income in property tax. But rising property prices have led to increases in taxable value as high as 48% in the last year, with the steepest climbs in Skåne and Gotland.

That affects not only young families but also retired people whose incomes are lower but whose living costs continue to rise.

Nuder is said to be keen to push changes through as quickly as possible, and the Left Party is ready to support such a move in the spring budget.

"The reason is that taxable values have increased since limits were introduced a few years ago, and so the rules must be more flexible and adapted to the reality of the situation," said the Left Party's budget negotiator Marie Engström to SvD.

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