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Sweden to fight EU ruling on VAT for non-profit groups

TT/The Local · 31 Mar 2011, 11:00

Published: 31 Mar 2011 11:00 GMT+02:00

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Currently the whole non-profit sector in Sweden enjoys an exemption from the consumption tax levied on goods and services and the government had applied to limit the levy to organisations with a turnover of more than one million kronor ($158,000).

Sweden's finance minister Anders Borg, expressed surprise at the news and vowed to file the Commission's ruling.

"We will contest this. We intend to pursue this all the way," Borg said at a press briefing on Thursday.

Non-profit groups can therefore rest easy for now as until the issue is settled - which according to Anders Borg could take a couple of years - the current rules allowing a full VAT exemption for non-profit organizations will apply.

The exemption is in contravention of European Union law and the EU Commission has persistently tried to force its removal.

The EU Commission ruling would impose a considerable burden on non-profit organizations, which range from charities to theatre and interest groups, and study circles.

However the EU considers the current tax regime to be overly generous and in the longer term the financial impact will be considerable. The administrative burden of paying VAT is also likely to increase, if the Swedish government loses in its bid.

The government's application for the one million kronor turnover limit was made in January and would mean that 90 percent of Sweden's non-profit associations would be tax exempt.

Story continues below…

The purpose of the application was to protect the financial stability of the sector and to furthermore avoid a lawsuit in the European Court of Justice.

TT/The Local (news@thelocal.se)

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Your comments about this article

12:31 March 31, 2011 by Nemesis
The people counting the money in Scientology, Catholic Church, Lutherian Church, Mosques, etc are not going to be happy about this.

Also in Sweden there is such a thing as an economic förengning.

I kid you not.

You can set one up one for your company and not pay any tax, if you do it right. All the pizza companies in the town I live in are economic förengning, as are most in Sverige.

The sooner this tax loophole is closed the better.

By doing this, the European Union is hitting the money laundering outlets for the KLA, hitting drug dealers, hitting traffickers, stopping cult financial origanisations such as scientologists, taking money out of the paedophiles in the catholic church and hitting money laundering operations for various terrorist groups.

Well done the European Union. More of this PLEASE.
12:34 March 31, 2011 by HYBRED
The money coming from private citizens has already been taxed once, how can you tax it again? Sometimes the EU makes Stalin look like a nice guy.
12:48 March 31, 2011 by Nemesis

What is selectively left out fo the article is that this is an anti-money laundering idea from the European Union, unless of course you agree with business's not paying tax, Scientologists and churches being tax free, traffickers being able to launder money, terrorists and drug dealers laundering money,
13:10 March 31, 2011 by HYBRED

Yeah okay. Lets all of us give all our money to the government. That would end money to charity, stop money laundering, and end money to the church.

Would you be happy with this? Oh, and we all wear a rubber suit so we don't hurt ourselves,too.
13:46 March 31, 2011 by Nemesis

If you wish to wear a rubber suit, go ahead. I really don't want to know.

Regarding the issue at hand.

Tax exemption in Sweden is very different from other countries and is basically a scam vehicle to avoid paying tax.
14:01 March 31, 2011 by HYBRED

So I guess the deduction for mortgage interest is just a scam, too?

In regards to your earlier post about business's paying/not paying tax: No I do not think business's should pay tax. Because everyone in the business whether it be owners, stock holders, or regular employees pay income tax generated by the business. So the cost of the business tax is passed down to the consumer and ends up being nothing more than a hidden sales tax.
15:35 March 31, 2011 by Nemesis

You are another neo-liberal or feudalist as it should properly be known.

If you want a system such as you propose, I would suggest you emigrate to Somalia, Afganistan or Saudi Arabia. You will feel quite at home, with their zero business regulation, lax gun laws and no womens or minority rights.

This is the 21st century, not the 11th century. Get that into your head or move to a country that suits your mindset, such as Somalia, Afganistan or Saudi Arabia.
15:51 March 31, 2011 by HYBRED

So here you go to name calling when you can present a intelligent arguement. I never said business's shouldn't be regulated. But the more you tax business the higher they charge for their products/services. Who is that good for, the government because they get more tax money.

Tell me about womans rights rights in Sweden. They get less than equal medical care than a man. And they are still kept down in equality to a man in the workplace. Don't take my word, ask them.

Laws are for the unlawful.

You should take your own advice,("This is the 21st century, not the 11th century.")
21:45 March 31, 2011 by Nemesis

What country are you from that women are more equal than in sweden?
08:03 April 1, 2011 by HYBRED

Let me clarify this so there is no mistaking what I am saying.

On paper women in Sweden or most any modern country for that matter, do have equal rights and opportunities. But in practice it isn't happening. Sure it's light years ahead of the middle east. Like I said, don't take my word for it, ask a woman.

I am a USA citizen permanently living in Sweden. And I would say that the situation is no better or no worse in USA when it comes to equality for women.
17:17 April 1, 2011 by Nemesis

That is just nonsense.

At present women are having there rights assaulted by the Republican party like never before.

On top of that women wokring for Wal Mart actually have to take a class action due to blatant discrimination.

The USA is literally heading towards the middle east, in how it treats women.
08:15 April 2, 2011 by HYBRED

You call what I say nonsense, but then the rest of what you wright supports my opinion.

Get a grip.
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