Nuder promises property tax freeze

Sweden’s finance minister Pär Nuder is proposing a freeze on property tax during 2007 and 2008. He said the Social Democratic-led government doesn’t need more than the 28 billion kronor taken in by the tax today.

”From a financial standpoint there is no reason to tax more than what we do today,” said Nuder. “I am eager to maintain the property tax, and since we now have the means, this is good to strengthen its legitimacy.”

The tax freeze would affect houses, owner-occupied flats and apartment buildings. The freeze could even take place in 2009, but Social Democrats would want to see an extensive tax study completed before that decision is made, something the ruling party plans to do during the next mandate period.

The Finance Ministry has worked hard on the property tax question since the competing Alliance bloc publicized its property tax relief plan in July. The left-wing bloc is in a dead heat heading into the September 17 national elections.

Nuder said there are three reasons for his tax plan: people’s anxiety for the “high property tax,” a new system for house financing, and an upcoming review of all taxes.

Nuder was critical toward the Alliance proposal to do away with the property tax and create a municipal fee. He said the idea was hatched during “a few late night sessions in a hotel room.”

Fredrik Reinfeldt, the head of the Moderate Party, and the presumed candidate for prime minister if the left-wing bloc loses, said Nuder’s plan was only worsening the problem.

“Those who vote for that have no idea what will happen after those two years are up,” he said. “This is a temporary solution and later things will be worked out.”