TetraPak billionaire offers Borg unsolicted tax policy advice
David Landes · 6 May 2009, 16:53
Published: 06 May 2009 16:53 GMT+02:00
“ABOLISH CORPORATE TAXES IN SWEDEN, dramatically, now,” writes Rausing in a letter faxed to Borg’s office at the Swedish Ministry of Finance.
The advice comes following a budget present recently by Borg’s British counterpart, Alistair Darling, which included a proposal to introduce a 50 percent income tax band for Britain’s highest earners (those earning more than £150,000 ($218,000) a year.
Rausing, who moved to the UK to escape Sweden’s notoriously high taxes and whose 2009 net worth is estimated to be around $6 billion, was recently ranked by the Sunday Times as Britain’s fifth richest person.
But the proposed UK tax hike has the octogenarian up in arms, and pleading with Borg to enact tax policies which will make Sweden more attractive to tax-wary corporations.
“England has just given Sweden a unique opportunity,” writes Rausing.
He suggests that abolishing Sweden’s corporate tax will “entice companies and entrepreneurs who want to leave England”, proceeding to portray himself as working hand-in-hand with Borg for the benefit of Sweden.
“The tax losses will be minimal if we succeed. Over half of a company’s turnover consist of taxes of various kinds, including employees’ income taxes, social fees, and value added tax,” he explains
“If these taxes can be estimated to be 20 times the revenue generated from tax on profits, then we only need to increase the budget by 5%. It looks easy because of this tax reform.”
Sweden’s corporate tax fell from 28 to 26.3 percent at the start of 2009 and generates about 100 billion kronor ($12.6 billion) annually, according to the Dagens Industri (DI) newspaper.
The finance ministry is now crafting a response to Rausing, DI reports, but is unlikely to take the aging billionaire up on his proposal as the ministry has no plans to reduce corporate tax any further.