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Sweden presents budget for 'full employment'

TT/Peter Vinthagen Simpson · 12 Oct 2010, 09:27

Published: 12 Oct 2010 09:27 GMT+02:00

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"The government's primary goal is to take Sweden back to full employment. We are therefore continuing our efforts to strengthen the work-first principle and reduce exclusion," Anders Borg said in presenting the budget worth a total 1,005.5 billion kronor.

Borg presented a raft of initiatives to promote the goal of full employment and "safeguarding publicly financed welfare".

Anders Borg laid out the government's priorities as: increasing employment and reducing exclusion, increasing knowledge, safeguarding core welfare services and reducing the effects of the crisis and reducing emissions and climate impact.

As expected taxes will be cut for pensioners, higher housing benefit allocated for child families and an extra 3 billion kronor earmarked for municipalities for 2011.

With more asylum-seekers having arrived in Sweden than previously forecast in 2010, the government has allocated 400 million kronor to helping municipalities to cope.

The government's main climate initiative is the so-called super eco-car premium, with further resources to combat climate change promised from 2013.

Education was an area in focus in the budget, with the emphasis placed on compulsory schooling, promising improvements in both "quantitative and qualitative terms".

In practice this means that teaching time for mathematics will be increased, further teacher-training offered, and an apprentice system introduced in high schools.

Additional funds were allocated for Almi - a publicly owned firm tasked with the promotion and development of competitive small and medium-sized businesses. A directed investment totalling 2 billion kronor was allocated to strengthen business development in the inland areas of northern Sweden.

The government outlined ambitions for reform over the mandate period totalling 33 billion kronor, including a fifth in-work tax credit and a hike in the threshold for the levy of state income taxes, to be combined with equivalent cuts in taxes on pensions.

Further ambitions include a halving of restaurant sales tax (VAT), to be financed by hikes in alcohol and tobacco taxes - on cigarettes by 8 percent, on snuff by 11 percent, and 13 percent on beer and wine.

The goal of introducing a compulsory unemployment insurance remains a priority, according to the budget statement.

If economic conditions allow, the government would also like to make further changes to "strengthen growth", for example in company taxes, payroll levies, the so-called temporary austerity tax, venture capital and research and development deductions, and expert taxes.

Story continues below…

The government deemed however that it is unlikely that the economic scope will facilitate the changes during the current mandate period.

The government also said it expected the partial sale of state owned

companies Telia, SBAB and Nordea to yield around 25 billion kroner a year for

the next four years.

TT/Peter Vinthagen Simpson (news@thelocal.se)

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Your comments about this article

10:29 October 12, 2010 by Great Scott
Extremely stupid, only people that can afford to go to a restraint will benefit, the likes of McDonalds and co will see no change in prices, and these companies will just pocket the difference.

Increasing beer by 13% is sheer madness, why not increase brandy or vodka for example by 50%, this is nothing but a budget to hit the lower paid and benefit the well off. The increase in beer tax will only fund tax hypes for the rich.

Oh, I forgot they were going to use the extra cash to plant job trees.
10:55 October 12, 2010 by Rap43
Tax cuts and business incentives under Bush in the USA nearly bankrupted the country... so... yeah, Sweden should do that too!
11:14 October 12, 2010 by RobinHood
@Great Scott

Do you actually believe beer is still the beverage of the "lower paid", and vodka that of the "rich"?

You should be exhibited in a Marxist museum.
11:25 October 12, 2010 by aaww

bring in mind that Sweden and US are totally different, Sweden has the worlds highest tax burden in the world, with figure close to 50%. US on the other hand has just around half of that.

this means tax cut in Sweden and US will end up in a totally different results, Sweden need tax reduction to bring back a dynamic economy.

on the other hand, i think Sweden would need to re-consider it's policy regrading resources, open up the freaking mines in the north, sell the iron ore and uranium to China, that will definitely bring Sweden employment back in super shape.
11:42 October 12, 2010 by Audrian
What he identified is a mixed bag of measures with no clear policy direction. 1) He did not explain what he would do with $2b (or $7000 per the unemployed), which he said is allocated for employment creation. Sweden is an advanced economy. Employment creation is often capital intensive, demanding several hundred thousand of dollars investment per person to create a job. On the other hand, if the objective to stimulate the economy out of recession the major area of investment is public works, which might demand more the amount shown.

2) The rest of his program activities are hotchpotch of activities which have nothing to do with employment creation. For example, the tax on beer has revenue objective. The danger of high tax on beer has a substitution effect. Drinkers of beer might move to the drinking of liquor, which probably has more negative effect on health than beer.
12:06 October 12, 2010 by JHD

I have a difficult time taking anything you say serious for the following reasons:

1. The expression is bare in mind, not bring in mind.

2. "Sweden has the worlds highest tax burden in the world." Are you a writer for the local?

3. If a subject is plural the verb needs to be plural... otherwise it reads as though it was penned by a child.

4. Reconsider is one word.

5. It's... a contraction of what is. It should be its.

I am typically not this critical of comments but for some reason reading through your post greatly annoyed me. Adhering to grammatical rules makes it easier for others to comprehend the point you are trying to convey.
12:12 October 12, 2010 by Great Scott

Why do you never have anything constructive say, while are you always playing "The Local" idiot.

Using the word "Marxist" just how childish are you.

Please change your user name, because your current one is nothing but an insult to the man himself.

Seeing that you are so thick, I used brandy and vodka as examples of spirits, do I have to spell that out to you. And yes beer is still the favourite of the lower paid.
12:13 October 12, 2010 by wiserthanmos
You hear that Slave-Swedes? Another 400 mils of your tax money for the potential asylum-seekers! Why don't they just put the signs along the Swedish borders that said...we are just a bunch of spineless suckers, please come and take advantage of us!
13:05 October 12, 2010 by aaww

looks like you are grammar teacher, good, but pls take your discussion to a grammar and spelling correction forum.
13:40 October 12, 2010 by xguild
As an American in Sweden its hard to say if some or any of these financial endevours will work, however I would point out that Sweden does not have as high taxes as people think. In fact I can tell you I paid considerably more tax in the US as a middle class American then I have ever been asked to in Sweden. On paper, ya the taxes are higher but when you apply it to your personal budget and realities of cost their is a considerably larger tax in the US then in Sweden, just not called "Tax" per say, but wether you call it a tax or a bill, its money out of your pocket and thats all that really matters.

Some examples. Child Care. My son is 6 years old today and the cost of having lived in the us for 1 year with my son compared to the last 5 is still to date considerably higher. It cost me 7,000 dollars just to have a baby in the US (so right out of the gate Im down about 50,000 Swedish Crowns. In the US their is no form of government support when it comes to children whatsover. Their is no free medical or dental, their is no insurance, their are no child services in which the government bares any of the cost. You can't even get a free lunch in schools. He will be 18 years old before the cost of taxes that I pay will make up for the cost I shelled out in the 1 year that we lived in the states.

Sure its not tax, but what difference does that really make.

Swedes are very lucky to have a government that wisely spends their tax dollar and while you can debate the logistics of immigration costs and what not, at the end of the day Swedes still end up on top everytime. Besides that things like Immigration are a problem anywhere life is good, you can't blame people for wanting to have a decent life.
15:20 October 12, 2010 by jbat

Your US country are much worst than Sweden when they introduce the same thing.. so its not the same...
15:27 October 12, 2010 by jbat
Yeahh.. give all money, jobs and anything to "class immigrants" like American immigrants and Spain immigrants (these 2 type of immigrants talked a lot here and very jealous about what refugee get hahaha.. )! This will be the best economic move ever for Sweden according to them!...

*** its pity to know that their own government cannot afford to take care of their own citizens that now become very jealous immigrants with poison in their words special for their new society !
16:00 October 12, 2010 by xguild
Well whats the difference between an immigrant who becomes a citizen and someone that is born in Sweden financially? I mean strictly speaking it takes a child about 18 years to get a job (Swedes often start much later), until then they are sucking on the tax nipple funded by society. Even a complete foreigner who comes to Sweden can become a productive citizen in Sweden in under 10 years and if you look at Turkish and Thai people as examples in Sweden it happens considerably faster (they often start businesses before they can even speak Swedish), so they are paying taxes considerably faster then any naturally born Swede.

Economically it is better for Sweden to take immigrants then making Swedish babies, that is an economic fact.

My point being that immigration is not a financial issue, its a issue of nationality. As a white American, until I open my mouth, everyone treats me as if I'm a Swede and has no issue with my immigration status. If your Thai, Turkish or of any other country where you appear to be an immigrant even if you are born in Sweden you are treated as an immigrant your entire life (aka part of the problem my most Swede standards).

Mind you this sentiment is not all that different in the US, having been raised in California, I know that Mexicans are treated exactly the same way. You can be born in California but if you appear Mexican you are part of the immigration problem in everyones eyes.

Immigration is simply not a problem here at all, its a hicup along a road of every responsible society in the western world to take immigrants into their country for hell holes which coincidently in most cases are made hell holes by western socieites. Sweden has played a very responsible and morale role in the world and should be proud of their ethical approach to immigration. To change it is to take a step backwards in my humble opinion, Sweden should be welcoming these people not turning them away at the borders, every western society should.
17:04 October 12, 2010 by wiserthanmos

I guess to engage in some kind of debate with someone like you is like debating a 5 year-old, so with all due respect, I'll try to say this to you as nice as I can possibly be...shut the hell up you dumb ass lefty! What a moron!
23:16 October 12, 2010 by ww77ww
@xguild - the western world has no obligation to accept hordes of immigrants. Immigration must be based around quality,not quantity. Sweden made no place a hellhole and does not owe anybody anything. Sweden has been acting irresponsibly for decades, not that I would expect an American to understand - seeing what your nation has wrought over the past century discredits your lecture.

Economically it could make sense to only allow EDUCATED immigrants who are open to integrate (as most are), but culturally this is more difficult. As someone without any cultural ideal, you maybe do not embrace this.

And regarding "full employment", it will not happen. Too many people, not enough decent jobs.
07:25 October 13, 2010 by ericrufinosiah
Sweden is imviting immigrants to help her to shore up it's population to compete with the native Swedish on welfare,housing,and etc.Perhaps,the New Swedish Government should formulate a " Birth incentives policy for native Swedish " (if there isn't ) and please don't tell me it is racist again,then only God can advise.As in the longrun,inviting immigrants to Sweden will cause more irreparable damage to the country as awhole.
08:49 October 13, 2010 by xguild
Well certainly wasn't my intention to press anyone's buttons, but facts are facts whether you call me names or not. Sweden is definitly responsible for many of the atrocities of war in the world as they are a provider of the very weapons used in Afghanistan and Iraq by the EU and other nations around the world. Sweden even has some very cozy deals with Saudi Arabia.

Sweden is not innocent by any stretch of the imagination.
16:41 October 13, 2010 by ww77ww
I see no facts. There is always a market for weapons, although the west should not be a military force in that region to begin with, Selling weapons is probably the weakest "crime" in the modern world. No matter your claims of false guilt, Sweden does not deserve to be eliminated by unsustainable and illogical immigration, as will happen under the plans of today. If there is to be immigration, and I do not claim there should not, it must be carefully managed and based on more than raw numbers.

And receiving a lecture of guilt from an American is the height of insanity - that entire region would not be unstable without the influence of you and your idiot British friends.
17:21 October 13, 2010 by izbz
We'll see about that
11:33 October 14, 2010 by AdamVikingen

Nonono, we dont have a tax on 50% we have tax on 33% (From 2008 i think) and the tax have probebly been lowerd since that! "Though" a few years ago Sweden did have the highest taxes in the world, and guess what, my town did at that time have the higest taxes in Sweden (i live in Kil) and i dident see any problem, i acyully think it was a lot better then it is now, at that time kil had hundreds of diffrent buissnises, but when the "aliance goverment" took over almost all of them dissaperd cuz the new princips only benefitet the larger companise and not the smaler ones, the smaler ones only got it harder, and it dident get better that a few month after that the finance crisis struck down on us, even though Sweden probebly is the nation that has had the lowest damage of it, it still made smaler buisnisses have a real hard time opening up!.

BUT, I still love this place!
13:09 October 15, 2010 by Thelocalboy
@Great Scott

I feel that the reduction in restaurant tax is there to benefit the owners of restaurants(who will then have more money to be able to employ more people or give current employees more hours) and not so much the consumer. Eg There is a higher VAT if you eat in, than take away. Quick Service Restaurants (not fast food any more ha ha) don't change their menu prices, so everytime someone eats in, the restaurant has to pay a higher tax. It is easy to "bash" big chains like McD's etc, but just remember that they are owned by local people (franchisees). It is a business like any other and my hat goes off to anyone that takes the risk to run their own business.

I applaud the government in discussing reducing payroll tax, which I think is one of the most stupid taxes. Why penalise a company for employing people?
15:43 October 15, 2010 by Shaikailash
I think xguild, in hif first post (13:40 October 12, 2010 by xguild), made a super great point.

I cannot understand why so many Swedish citizens writing on this site seem to become more and more against the taxes and the welfare state they have, which ranks always at the top. I hope this is not the majority feeling, but it seems so, looking at the election results.

I fear that if this trend goes on, the Swedish themself (and not the immigrants) will destroy their own quality of life with their own hands!

Probably because you are too used to have services, childcare, high and free education, and today you cannot see the advantages compared to other European country. No speaking of USA, which is terrible from this viewpoint.

And, please, don't stick on TAX LEVEL comparison, you should be happy to pay your taxes and have a lot of good services in return. I'll explain why the tax burden rate is misleading, in brief.

Take ITALY, with around 43% of taxes, is much lower than Sweden. Well, if you calculate the REAL tax burden taking into account the black market, and the tax evasion (over 200€ billion), the tax burden in Italy for the honest paying citizens is around 55%!!! Far more than Sweden, but with half the services! No childcare, no family policies, low unemployment benefits, lowest-low R&D, and so on...

So please, pay your taxes and defend your model, rather than put all the blame on immigrants (of course you have to control it, but that is not the main and only problem!) and vote for crazy people that want to follow the american/british failing model!

I love your country, this is why I'm so worried for you. Don't take it bad.
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