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Grand tax reform unknown among the public

Politics | 2010-01-23
One of the government´s main reform this term, the job tax credit, is mostly unknown among the Swedish public, a new poll shows. The tax credit, whose fourth step was introduced this month, is the darling of the Minister for Finance, Anders Borg. It has been widely discussed in the political debate and the Social Democrats want to retract the credit by half, if they win the election in September.

Only four out of ten people know about the job tax credit, or ´jobbskatteavdraget´ as it is called in Swedish. This shows a survey by Statistics Sweden and the National Audit Office.

When the Swedish workforce get their pay this month there will be more money after taxes, compared to the pay in December. The reason is the fourth step in the job tax credit programme.

Those who earn SEK 20.000 a month and have a local tax of 31 percent will receive SEK 1363 more in the wallet, compared with four years ago. For those who earn SEK 28.000 a month it gives the total of SEK 1752 more.

The government hopes that the SEK 70 billion in lower taxes in the long run will stimulate around 90.000 persons to enter the labour market.

But among those who now are without a job, only three out of ten know about the job tax credit, and among young people up to 24 years of age, only two out of ten know about the tax reform.

Opposition sceptic

The political opposition do not think the job tax credit leads to more people seeking jobs. They have informed than only the first and second step in the tax programme will remain if the Red-green coalition gain power later this year.

The economic policy spokesman for the Social Democrats, Thomas Östros, told public broadcaster SVT that he do not think the tax credit has led to more people trying to find employment.

“The job tax credit has failed. I think we should change policy and focus on increasing the number of jobs," Östros said.

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