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EXPLAINED: What does Sweden's budget mean for international residents?

The Local Sweden
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EXPLAINED: What does Sweden's budget mean for international residents?
Families with children between four and 16-years-old will be able to take out three days off on 80 percent salary. Photo: Simon Paulin/Imagebank Sweden

Finance minister Magdalena Andersson has put forward an expansionary budget aimed at securing support from all three of its support parties. But what does it all mean for international residents?


It's worth noting that the budget is not guaranteed to pass. This is the government's proposal and in order to pass, it requires a majority of parliamentarians not to vote against it. Opposition parties also have the chance to put forward their own rival budget proposals, either individually or together, which could be passed instead of the government's if it receives more votes.

Tax cuts

The budget includes 10 billion kronor to cover tax cuts, primarily for low- and middle-income earners, but also for people on sickness and disability benefits and for members of Sweden’s unemployment insurance funds.

This will be mean a tax cut of up to a maximum of 2,820 kronor per year in 2022 for those earning over 265,000, with smaller reductions for those on lower salaries.

For the many foreigners who have not yet signed up to an A-Kassa, one of the funds that run Sweden's voluntary unemployment schemes, the budget makes it considerably cheaper to do so, proposing a new tax rebate allowing members to claim back 25 percent of the membership fee, saving members roughly 400 kronor each, starting from July 1st, 2022. 

The threshold at which small businesses have to pay VAT (moms) has been increased from total annual revenues of 30,000 kronor to total annual revenues of 80,000 kronor, which will free many foreigners who have set up their own small companies both from the payments as well as from a lot of tedious administration. 



Foreigners with children will benefit from the long-promised "family week", which will from next April allow parents with children between four and 16 years old to take out a total of six days a year -- three days per parent -- to be with their children on 80 percent of their salaries. Single parents will be able to take out the full six days. The new benefit is estimated to cost 3.5 billion kronor.

The government hopes the week will provide "increased flexibility for working parents", "facilitating a good work-life balance, reducing stress for parents, and increasing time together for children and parents." 

The proposal has been criticised by both the Swedish Federation of Business Owners and the The Confederation of Swedish Enterprise, which said that the measure would effectively reduce the labour force at a time when businesses are struggling to find staff. The government's own calculations suggest that the measure will cost 23 million person-hours of labour.  

The government is also increasing child support payments for single parents with children between seven and ten years of age, by 150 kronor per child per month. 

Sick pay 

Higher-earning foreigners who are off work sick will be able to claim back more of their salary after a rise in the top annual income on which workers can receive 80 percent of their salary back in sick pay is raised by 25 percent to about 476,000 kronor.

The government estimates that this will mean 1.2 million more employees will be able to get 80 percent of their salary back in sick pay, and will cost a total of 2.6 billion kronor.  

The government is also reducing income tax on sick pay, so that the additional tax burden faced by those on sickness benefits compared with those who are fully employed is reduced. 

The government also wants to extend the length of time that people can be on sickness benefits from 365 days to 550 days, and also to change the rules so that those on sickness benefit can work part-time. 

Employment (and unemployment)

The government has proposed reducing the number of days a person has to be unemployed before their benefits start being paid out under the A-kassa system from six days to two days. The change will come into effect on January 3rd, 2022 and will last until January 1st, 2023.

The government is also spending 1.2 billion kronor on privately run 'matching services', which will complement the work of the Swedish Public Employment Service (Arbetsförmedlingen) with the goal of helping more people in Sweden find work. 



Foreigners who want to send their children to privately-run international schools in Sweden will in the future have to apply through the same application system as is used for municipal schools under the government's budget proposal for a "common school choice system with changed selection criteria", estimated to cost 70 million kronor in 2022.

Depending on the system's final form, this may, for good or ill, reduce the ability of parents to use their networking skills to jump the queue, and may also reduce the advantage enjoyed by parents with the foresight to put their children on waiting lists at birth. 

The Swedish National Agency for Education, (Skolverket) has argued that the queue system leads to segregation, but the Centre and the Liberal party have argued instead that free schools decrease segregation, and that moving to a common queuing system would make school choice entirely dependent on the area where parents live. 

The grading system for upper secondary schools is also being changed, so that instead of pupils getting a grade on each individual course they take during over the two years (a so-called kursbetyg or "course grade"), with all those grades counting towards their final result, they will only receive a final grade on each subject at the end of their studies (a so-called ämnesbetyg, or "subject grade")  

The change was welcomed by the teacher's union when it was announced last month.

Foreigners living in Sweden who struggle to find work because of a limited level of education will benefit from the budget's big expansion of adult education, with plans to double the number of places at vocational colleges, 17,000 new places for those who need to complete their high-school education, 12,000 apprenticeships (praktikplatser) and 4,500 new introduction jobs.

The government has also earmarked an extra 100 million kronor for education aimed at increasing the skills of the workers needed for the green transition. 


Foreigners who have failed to build up a workplace pension will benefit from the extra housing benefit for pensioners who are living only on the basic pension, with the top payment raised from 7,000 kronor to 7,500 kronor. 

In addition, those who become sick when they have only five years left until pension age will be more easily able to receive sick pay without risking their long-term pension.  


Green car taxation

The government is tightening the screws on those who drive polluting cars, with the threshold for being hit with a CO2 charge cut from 90g CO2/km to 75g CO2/km, and the threshold for the top level of the charge cut from 130g CO2/km to 125g CO2/km. 

At the same time, the threshold for getting an environment bonus has been cut from 50g per kilometer from 60g/km, and the bonus for hybrid electric cars has been reduced by 10,000 kronor. 

The Aftonbladet newspaper estimates that this will increase the cost of driving a Volvo V60 petrol car by 1 730 kronor a year. 

Cheaper repairs and rentals of tools and more

The government plans to halve value added tax on repairs of shoes and bicycles from 12 percent to six percent, and also to allow people to hire out tools, boats and other things tax-free up to a value of 20,000 SEK a year. 


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