Red-Greens agree on property tax changes

The centre-left coalition has announced an agreement over property taxes, claiming that only 1 percent of Sweden's house owners will see their taxes climb if the Red-Greens win the election.

Red-Greens agree on property tax changes
Valtersson (Green), Östros (Social Democrat) and Andersson (Left) in early May

“We have understood that many homeowners have expressed concern over what will happen with their property taxes when their houses are next revalued,” said Thomas Östros, Ulla Andersson and Mikaela Valtersson of the Social Democrats, Left, and Green parties respectively in a statement on Wednesday.

The Alliance coalition government presented its revision of the property tax system in 2008, with the opposition parties accepting most of the changes in 2009 with a proviso that they would impose an additional 1 percent levy on homes valued for tax purposes in excess of 4.5 million kronor ($612,463).

Sweden’s homes will be revalued for taxation purposes in 2012 and until the red-green statement on Wednesday it had been unclear how many homeowners would be affected.

“We are thus presenting a clear statement that the proportion of houses covered by the higher property tax will not increase.”

According to a Sifo survey commissioned by the Svenska Dagbladet (SvD) daily last summer the new levy would affect 1.4 percent of Sweden’s homes, amounting to around 33,000, of which 23,000 are located in Stockholm – around 7.5 percent of the total.

The Social Democrats and the Green Party have long argue for rise in the threshold for the new levy, which if left unchanged would have increased taxes by around 130 million kronor in total, but the Left Party has until Wednesday remained sceptical.

“Our red-green promise is that the accumulated tax on properties will not be increased in comparison with today’s system,” the three parties confirmed.

Thomas Östros has forecast the new threshold for the higher tax levy in 2012 will climb to a market value of around 6.5-7 million kronor, SvD has reported.

The parties have also confirmed that they plan to extend the proposed cap which limits an individual’s property taxes to 4 percent of income to cover summer houses and all groups in society. Furthermore they promised to halve the tax take on rental and tenant-owner apartments.

The Alliance coalition’s manifesto in the 2006 general election promised an abolition of property taxes, then 1 percent of a property’s taxation value (roughly 75 percent of market value).

Instead of abolition the Alliance government changed the tax into a “municipal charge” with a annual ceiling of 6,000 kronor per house and 1,200 kronor per apartment.

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