Finance Minister defends property tax reform

Finance Minister Anders Borg defended on Tuesday the government's decision to abolish residential property tax and replace it with a local council fee.

But OECD tax expert Jeffrey Owens, speaking at a taxation conference jointly hosted by the Organisation for Economic Co-operation and Development (OECD) and the Confederation of Swedish Enterprise, predicted that Sweden would reintroduce the tax “within five years”.

Anders Borg told listeners that while he understood the OECD’s criticism “a tax has to be legitimate” in order to function properly.

“It is the one tax that Swedes consider most unfair, which is why we have removed it,” he added.

The Organisation for Economic Co-operation and Development has criticized the Swedish government’s decision to abolish residential property tax on the basis that Sweden needs to reduce tax on labour, not property.

“When we are sitting here in five years’ time Sweden will have reintroduced property tax,” said Jeffrey Owens.

While the pair failed to see eye to eye on the property tax issue, the OECD has praised the government for cutting taxes for low earners and for its reforms to the unemployment benefit system.

And Jeffrey Owens urged the government to continue making adjustments to the tax system.

“In general Sweden’s tax system is well-designed and you are on the right track but above all you should not stop reforming your tax system. Tax reform is a work in progress in today’s world,” he said.


Sweden encouraged to improve integration in schools

Sweden can do much more to help immigrant children perform better at school, a new OECD report says.

Sweden encouraged to improve integration in schools
File photo: Fredrik Sandberg / TT
The report, carried out by OECD at the request of the Swedish government, suggested that Sweden’s integration efforts have strained under the weight of the large number of migrants who have entered the country in recent years. 
“Within OECD countries, Sweden has historically welcomed large numbers of migrants, in particular migrants seeking humanitarian protection,” the report reads. “Since 2015, this large influx of new arrivals with multiple disadvantages has put a well-developed integration system under great pressure.”
The study notes that 61 percent of first-generation immigrant students do “not attain baseline academic proficiency”. The number decreases to 43 percent for second-generation immigrant students and that 19 percent differential is well above the OECD average of 11 percents. 
The report gave 20 recommendations for how Sweden can improve the situation, including taking steps to counteract the negative impact that the free choice of schools can have on integration. The group suggests giving the children of immigrants more opportunities to choose the school they want to attend, as well as introducing special quotas for socio-economically disadvantaged students, issuing grants for these students and incentivizing independent schools to take on new pupils. 
The OECD also suggested that Swedish authorities examine how other countries tackle the problems of integration, pointing to countries like Germany, Austria, the Netherlands, Canada and the United States as good examples. 
The report also emphasized the importance of including multicultural awareness in the curriculum of schools across Sweden, so that students are exposed to “positive messages” regardless of their origins, according to a government press release
“The OECD has done a thorough job on this report. It’s good to be assured that we are on the right track. At the same time, the OECD has confirmed my view that Sweden should do more to mix students from different backgrounds,” Education Minister Anna Ekström said in the press release. 
Among other suggestions are hiring more teachers, increasing educators’ salaries and incentivizing teachers to take jobs at the schools that need the most help. The 146-page report can be found here