16 September 2008, Stockholm, Sverige

Catella Sponsor comments on the Swedish Government’s tax proposals

The Swedish Government presented a series of tax proposals in a memorandum released on 9 September 2008. For more details, read the comments of Cecilia Gunne, our tax lawyer at Catella Sponsor, regarding the changes.

- Social security contributions, employer's contributions, and social security contributions by the self-employed are to be cut by one percentage point.

- Corporate tax will be reduced from 28 to 26.3 per cent. Also, the tax on expansion reserves for sole proprietorships is reduced to 26.3 per cent.

-  What are referred to as the 3:12 rules have been changed. The maximum requirement for payments of salary has been reduced from 15 to 10 income base amounts for entitlement to 20 per cent tax on dividends and - through a standard amount that may be paid out as a 20-percent taxed dividend - from 2 to 2.5 base amounts, that is, from some SEK 92,000 to SEK 115,000 annually.

- A major reduction in social security contributions and general wage surcharges for youths has been expanded to cover all those of a maximum age of 25, while the amount has also been increased. 

- The Government has introduced the potential for companies for direct write-offs. Inventories with a value of less than a half base amount may be written off directly.

- Tax planning via partnerships through under-priced transfers and write-downs of shares in inventory has been prohibited.

- Tax planning by means of interest payment deductions within organisations with "shared interests" have also been prohibited.
Certain simplifications to reduce the administrative burden for companies will be implemented.

The Swedish Government will present its 2009 Budget Bill on 22 September.

Cecilia Gunne, Tax Lawyer, Catella Sponso

Cecilia Gunne, Catella Sponsor