• Sweden's news in English

Opposition outlines change in shadow budget

Peter Vinthagen Simpson · 3 May 2010, 10:30

Published: 03 May 2010 10:30 GMT+02:00

Facebook Twitter Google+ reddit

The Red-Green coalition press conference was opened by the Social Democrat party economic spokesperson Thomas Östros who pledged a series of changes to help to finance investments in environmental initiatives as well as labour market and taxation reforms that will see taxes rise by a total of 24 billion kronor.

"Sweden shall return to budget surplus and strong public finances. Sweden's competitiveness shall be reinforced, we suggest significant investments in new jobs, training and education. Among other things we want to expand the university system, strengthen labour market training programmes and cut payroll taxes for small companies," Östros said.

The three parties - the Social Democrats, Green Party and Left Party - announced that the defence budget would be cut by two billion kronor ($275 million) to help to finance the changes.

The coalition meanwhile announced plans to abolish the cut in payroll taxes directed towards people under 26 introduced by the Alliance government, providing for a saving of 10 billion kronor.

"This has created very few job opportunities and will be compensated by the general cut in payroll taxes for small companies," Östros said of the reform which will cost six billion kronor in 2012.

The trio have agreed to leave income taxes relatively unchanged with monthly incomes of up to 40,000 kronor enjoying existing tax reductions, with a gradual phasing out of the tax break for those earning up to a ceiling of 80,000 kronor per month.

The coalition argued that their joint budget proposal is intended to redistribute wealth from the better off, whom they argue have benefited disproportionately from the government's tax cuts. The intention is also to reduce differences in taxation levels for groups in work and those outside of the labour market, such as the sick, unemployed and pensioners.

"A gulf has been introduced in the taxation of pensioners," Östros said, claiming that Sweden is unique worldwide in levying higher taxes on pensioners than those in work.

The opposition laid out plans to increase unemployment insurance pay outs to 80 percent of salaries with the ceiling hiked to 930 kronor/day in 2011 and 950/day in 2012. Membership in the unemployment insurance schemes will be cut to 80 kronor per month and become tax deductible.

"This is a question of protecting the Swedish model, with strong, responsible unions that contribute to stability in the workplace and who are big enough to negotiate collective pay agreements," said Ulla Andersson of the Left Party.

The opposition meanwhile ruled out making membership of an unemployment insurance scheme compulsory.

Those living in homes valued at more than 4.5 million kronor will pay higher property taxes and a form of wealth tax (abolished by the government in 2008) is set to be reintroduced, raising a projected four billion kronor from 2012.

"We don't want to reintroduce the old system, which had clear faults, but we have agreed to conduct a review and as a result of that, introduce some form of tax on the wealthy," said Mikaela Valtersson of the Green Party.

The opposition furthermore plans to abolish the tax deduction for household services (RUT-avdrag) that the government claims has generated 7,000 jobs during its tenure.

Story continues below…

They will however retain the tax deduction for home repairs and maintenance (ROT-avdrag) as part of a programme of initiatives addressing the environment, to include investments totalling 120 billion kronor in railways and public transport by 2021.

Part of this programme is a plan to double the construction of climate smart rental apartments (hyresrätt) during the next mandate period with the introduction of 1.4 billion kronor in state support as well as a general 12 billion provision to the municipalities in 2011 and 2012.

Previous initiatives announced include a new carbon tax on petrol, raising three billion kronor in 2011, and five billion kronor in 2012.

Alcohol and tobacco taxes are also set to rise to pull in a further two billion kronor.

According to their calculations the Red-Greens advise that 55.4 percent of their reforms benefit women - the big losers under four years of Alliance government rule, they claim.

Peter Vinthagen Simpson (news@thelocal.se)

Facebook Twitter Google+ reddit

Your comments about this article

12:53 May 3, 2010 by steve_38
I see the communists are out again in force.

Why work hard and put your self out when you can do nothing and get well looked after.

Looks like a manifesto for the scivers(those who dont want to work).

Increase insurance and the payout, but make it like a real insurance where the more you use it the more it costs.

If the opposition are so into people why is it my Swedish brother in law has been working in a swedish university for 6 years as a temp and cannot get a full time job even though he has had the same job during all this time. Might be something to do with Swedish employment legislation ???.
13:08 May 3, 2010 by zircon
Shadow budget.. Shadow accountant.. Sounds like the job for me... (with the emphasis on shadow.)
13:31 May 3, 2010 by Kevin Harris
Clearly the news from Greece just passed these people by. The Give It All Away parties always go bankrupt in the end. The Swedish model seems to escape economic gravity (so far) be having countering years or red fiscal irresponsibility with half that time of blue austerity to rebalance the books. Then it's back to financial La La Land. It seems an odd sort of way to run an economy to me, but then every country gets the government is deserves. If this is the way they want it, so be it.
16:20 May 3, 2010 by morchad
Was in Uppsala on Saturday and witnessed all of the political rallies.

I listened to all they had to say.....

Left Party with the same old communist rhetoric....they had bad coffee and a really poor selection of buns :-(

By a Swedish mile the winner was Christian Democrats... the cake was amazing and they had 3 bouncy castles....they even let the adults in :-)

For this election I'd say...better the devil you know
16:53 May 3, 2010 by Mb 65
Sweden will be a 2nd England if this lot get in.
18:06 May 3, 2010 by miss79
yep Mb65, i agree, if the alliance wins..sweden will be finished..no more best live standard in the world n will become like england the POOREST country in europe
21:46 May 3, 2010 by Economist
I am not a Nobel prize winner in Economics, but I do have some insights to said about various economic policies. Today, I begin with Earn Income Tax Credit (EITC).

If I were in the government, I want to strenght and expand the current Earn Income tax Credit. I have not hear anything about the Earn Income tax credit policy from the political parties.

According to a simulation of an economy, an increase in EITC will induce wage moderation and increase search intensity by unemployed and hence rise employment.
02:11 May 4, 2010 by zsuf0103
cut in payroll taxes for small business.... to reduce the unemployment...but the real fact is that small business usually maintain by the family members due to this they enjoy the tax benefit....now cut in payroll taxes for small business is giving them more .......................
Today's headlines
Video: How to be Joel Kinnaman for a day
Kinnaman with one of the camera rigs that will allow people inside his head. Photo: Tele2

The Swedish Hollywood actor will strap a camera to his head, stream it live and allow viewers to interact with him this weekend.

Presented by Invest Stockholm
How Stockholm's cold climate boosts creativity
Photo: Ola Ericson/imagebank.sweden.se

Do long, dark winters actually make Swedes more creative and more productive? We spoke to Stockholm startups to find out.

Meet Sweden's lonely Donald Trump voter
A Donald Trump campaign button. Photo: Rogelio V Solis/AP

The Local talks to an American Donald Trump supporter on what it is like living in progressive stronghold Sweden.

Sweden to keep record-low interest rate in 2017
Sweden's landmark negative interest rate will continue towards 2018. Photo: Anders Wiklund/TT

The Swedish central bank said that it will take longer than expected to reach its inflation target.

Presented by Stockholm University
9 unexpected programmes at Stockholm University
Photo: Niklas Björling

Did you know Stockholm University offers 75 master's programmes taught in English? And some of them are programmes you won't find anywhere else...

Creepy clown messes with the wrong dog walker in Sweden
Not the clown in the story. Photo: Pontus Lundahl/TT

A dog helped its owner fight off a creepy clown chasing the pair in southern Sweden.

A million Swedes are digitally excluded: report
How should Sweden bridge the digital divide? Photo: Henrik Montgomery/TT

Tech-savvy Swedes? Perhaps not. A new study suggests that at least a million of its residents feel the pain of the digital divide.

Malmö's 19th Swedish title sets Champions hopes alight
Malmö fans celebrating after the match. Photo: Björn Lindgren/TT

Malmö FF have their eyes set on the Champions League after winning the Swedish league for the 19th time.

What's on in Sweden
Five great autumn events in Sweden this week
Jazz in northern Sweden. Photo: Umeå Jazz Festival

Food, music, movies and more food. What better way of helping yourself forget that the days are getting shorter and colder?

Here's how slow Sweden's high-speed trains are getting
A Swedish SJX2000 high speed train. Photo: Tomas Oneborg/SvD/TT

The high-speed rail journey between the three biggest Swedish cities is about to get longer.

Sponsored Article
One expat's strategy for making friends in Stockholm
People-watching: October 26th
Sponsored Article
Nordic fashion in focus at Stockholm University
Sweden cuts 2016 refugee forecast
Is Game of Thrones coming to Sweden?
Blog updates

6 October

10 useful hjälpverb (The Swedish Teacher) »

"Hej! I think the so-called “hjalpverb” (auxiliary verbs in English) are a good way to get…" READ »


8 July

Editor’s blog, July 8th (The Local Sweden) »

"Hej readers, It has, as always, been a bizarre, serious and hilarious week in Sweden. You…" READ »

Sponsored Article
Stockholm: creating solutions to global challenges
Property of the week: Kungsholmen, Stockholm
Sponsored Article
Last chance to vote absentee in the US elections
Will Swedes soon be looking for fairtrade porn?
The Local Voices
'I simply don’t believe in nationality'
Why we're convinced Game of Thrones is based on Sweden
Sponsored Article
This is Malmö: Football capital of Sweden
People-watching: October 21st-23rd
Sponsored Article
Where is the Swedish music industry heading?
Fury at plans that 'threaten the IB's survival' in Sweden
Analysis & Opinion
Are we just going to let half the country die?
Sponsored Article
Why you should 'grab a chair' on Stockholm's tech scene
Angry elk chases Swede up a lamp post
Sponsored Article
Swedish for programmers: 'It changed my life'
The Local Voices
'Alienation in Sweden feels better: I find myself a stranger among scores of aliens'
People-watching: October 20th
Sponsored Article
Top 7 tips to help you learn Swedish
The Local Voices
A layover at Qatar airport brought this Swedish-Kenyan couple together - now they're heading for marriage
Sponsored Article
‘Extremism can't be defeated on the battlefield alone’
Swede punches clown that scared his grandmother
Sponsored Article
Stockholm: creating solutions to global challenges
Fans throw flares and enter pitch in Swedish football riot
Sponsored Article
Why you should 'grab a chair' on Stockholm's tech scene
Could Swedish blood test solve 'Making a Murderer'?
Sponsored Article
Where is the Swedish music industry heading?
Swedish school to build gender neutral changing room
Sponsored Article
One expat's strategy for making friends in Stockholm
People-watching: October 14th-16th
Sponsored Article
Nordic fashion in focus at Stockholm University
Man in Sweden assaulted by clowns with broken bottle
Nobel Prize 2016: Literature
Watch the man who discovered Bob Dylan react to his Nobel Prize win
Record numbers emigrating from Sweden
People-watching: October 12th
The Local Voices
'Swedish startups should embrace newcomers' talents - there's nothing to fear'
How far right are the Sweden Democrats?
The Local Voices
Syria's White Helmets: The Nobel Peace Prize would have meant a lot, but pulling a child from rubble is the greatest reward
jobs available