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Taxes on companies still high in Sweden: study

David Landes · 14 Oct 2010, 13:17

Published: 14 Oct 2010 13:17 GMT+02:00

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In 2009, Sweden cut corporate taxes from 28 percent to 26.3 percent. However, similar moves by other countries in Europe and the rest of the world have left Sweden looking like a high-tax country for corporations.

According to the KMPG tax consultancy’s Corporate and Indirect Tax Survey 2010, the global average corporate tax rate dropped from 24.03 percent to 23.45 percent.

“The trend is clear, corporate taxes have dropped every year this decade, as long as we’ve been doing this study,” said Helena Robertsson, head of KPMG Sweden’s corporate tax business, in a statement

“The changes are incremental, but over ten years we’re talking about a drop of more than 7 percent.”

Corporate tax rates are an important incentive for attracting foreign investment. According to the survey, 18 European Union (EU) countries have lower corporate tax rates than Sweden.

EU countries with higher corporate tax rates than Sweden include the UK, Germany, and France.

According to Robertsson, many countries in Europe have made up for the loss in corporate tax income by raising other taxes, including value added taxes (VAT) charged to consumers when they make purchases.

Story continues below…

“Swedish companies lose millions every year by mishandling VAT, for example. As VAT gets higher, the costs of not handling it correctly becomes all the more expensive,” said Robertsson.

David Landes (david.landes@thelocal.se)

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Your comments about this article

17:30 October 14, 2010 by Swedesmith
Wonder how much money this study cost the taxpayers?
13:26 October 15, 2010 by Thelocalboy
As a small business owner, I wish they would lower the "payroll tax" here. It costs too much to employ people at the moment. If you reduce the payroll tax this should stimulate employment, and the savings that would be made in unemployment benefits (and their administration) should be able to pay for this somewhat.

Then, the people that are working have more money to be able to spend in the economy.

Problem solved. he he

But perhaps this is too simplistic a view?
15:00 October 16, 2010 by azote
I agree, the main obstacle for creating employment is too high payroll tax and far too high tax on overtime hours. Income tax harmonization is important but less in comparizon.
00:19 October 18, 2010 by Toonie
Do small companies in Sweden receive assistance when taking on new employees, especially young people? In some parts of the UK graduates new to the labour market attract a minimum wage per week of which about 35% per cent can be paid by the regional authority. This helps young people get into employment (it beats unpaid internships - which only the affluent young can afford to take) and gives small companies some assistance. I was self-employed in Sweden in the 80s and was appalled by the regressive nature of taxation back then. Especially when so many of my Swedish acquaintances were taking advantage (to say the least) of generous benefits. As one said to me, 'They have plenty of money', (they being the government), forgetting that the money had to come from somewhere. I hope those attitudes are long gone.
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