Swedish pensioners promised tax cut

Swedish pensioners promised tax cut
Sweden's Alliance government has promised pensioners reduced taxes in 2013 or 2014 - if the public finances allow, with reforms to help the poorest pensioners to come into force already next year.

“To next year prioritise reforms for the worst-off pensioners is justified in terms of the uncertain economic situation,” Prime Minister Fredrik Reinfeldt and the three other party leaders in the center-right government coalition, write on in a debate article in Dagens Nyheter.

For those with earnings-related pensions, the increase will amount to around 3.5 percent next year and those on guarantee pensions can expect to have their pension hike 2.8 percent.

“Along with the expected low inflation and hence lower price increases this will mean a noticeable increase in real incomes for Sweden’s pensioners,” writes Reinfeldt (Moderate), education minister Jan Björklund (Liberal), enterprise minister Maud Olofsson (Centre) and social affairs minister Göran Hägglund (Christian Democrats).

The tax credit that the alliance promises the retired in 2013 or 2014 is not dependent on a future tax deduction. However, makes the four party leaders clearly state that “intrinsic value” in the tax gap between pensioners and wage earners.

“It should pay to work, but it is also should also pay to have worked,” the four write promising to “work towards a gradual reduction of the tax difference in the future.”

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