Extension of the temporarily increased tax reduction on certain diesel use within agriculture, forestry, and aquaculture
Translated from Swedish by AI; the translation may contain errors. The Swedish text is the original.
Summary AI, written in advance
The debate concerns the extension of the tax reduction on diesel within agriculture, forestry, and aquaculture. S considers the extension to be good as it alleviates the vulnerable situation for companies 1. V considers that the proposal hinders the climate transition because it subsidizes fossil fuels 2. SD considers that the extension is necessary to keep prices and inflation down 3. C welcomes the extension and wants the reduction to be made permanent 4. C also considers that the measure saves agriculture and secures food production 4. M considers that the measure supports domestic food production and households 5. M considers that the measure has a small climate impact 5. MP considers that the proposal hinders the climate transition and disadvantages companies that have reduced their diesel use 6. KD considers that the proposal increases the self-sufficiency rate and strengthens the competitiveness of agriculture 7.
Written by AI in advance and may contain errors. The numbers lead to the speech a statement builds on; check against the text below.
Peder Björk (S)
Madam Speaker! Already in 2005, a reduction of the carbon tax on diesel used in work machines in agricultural, forestry, and water management activities was introduced. This was done to strengthen the international competitiveness of agriculture and forestry. Since then, the size of the reduction has varied over the years. The reduction, which also applies to fuel consumption in ships and certain boats in such activities, has recently been temporarily extended through partly changed carbon tax refund amounts, and partly through energy tax refunds.
The latest temporary extension of the tax reduction expires on July 1, 2023, according to current legislation. At that point, the reduction of the energy tax expires, and the reduction of the carbon tax reverts to a previously established amount. A new law must simply be in place for the reduction of the tax on diesel to continue to apply, and that is also the reason why we are debating here in the chamber today the Committee on Taxation's report number 17 with the hardly exciting, but indeed so important, heading Extension of the temporarily extended tax reduction on certain diesel use within agriculture, forestry, and aquaculture.
Madam Speaker! The temporarily increased reduction of carbon and energy taxes was introduced against the background that the price of several important input goods within these industries has increased sharply, not least due to the war in Ukraine. But there is also a need to maintain and strengthen Swedish food production in the extraordinary situation prevailing due to events in the outside world. Unfortunately, the reasons persist even today, and in several respects, the problems have deepened.
In the bill that forms the basis for today's debate on an extension of the tax reduction, the Sweden Democrat-led government makes the assessment that the high inflation, the gloomy economic outlook in the near term for among others households, and the unstable security situation in our surrounding area collectively contribute to an unpredictable development. It is an assessment that can clearly be agreed with, but the right-conservative government could have done significantly more to facilitate matters in an economically difficult time.
Extension of the temporarily increased tax reduction on certain diesel use within agriculture, forestry, and aquaculture
For example, the Sweden Democrats and the government could have refrained from lowering the tax by 13 billion kronor for those with the absolute highest incomes. Instead, those funds could have been used to facilitate things for families who struggle to make their daily lives work out financially. Or, for that matter, the Sweden Democrats and the government could have listened to the municipal and regional politicians from both the left and the right who are desperately crying out for financial support so that they do not have to implement large cuts in, among other things, the school, elderly care, and healthcare.
Madam Speaker! Swedish farmers are having an incredibly tough time right now. An extension of the temporarily reduced tax on diesel is a meager consolation when, among other things, they have had to wait unreasonably long for electricity support, which is furthermore only given to entrepreneurs in southern Sweden, and when they have, from one day to the next, received changed conditions and increased costs for biogas. An extension of the temporarily increased tax reduction on certain diesel use is hardly enough to prevent prices on, for example, dairy products and grain from becoming even higher.
With that said, it is good that there will be an extension of the temporarily increased tax reduction. Even if the tax relief does not change the entire situation, it at least mitigates the strained situation that Swedish companies within the land-based industries are currently in.
Ilona Szatmári Waldau (V)
Madam Speaker! Green nutrients are of crucial importance for our opportunities to build a sustainable society. The Left Party's position is that the state, through financial support and steering measures, shall contribute to agriculture, forestry, and aquaculture that is conducted sustainably in accordance with adopted goals, both nationally and globally, and which strengthens our national self-sufficiency of food.
Due to Russia's full-scale war in Ukraine, we consider that economic support for agriculture has been justified and that it continues to be needed due to sharply increased prices on input goods such as fuels, artificial fertilizers, seeds, and feed. In this, we share the government's assessment. Increased fuel prices are significant costs for many green industries.
We must also phase out fossil fuels and strengthen the transition to sustainable alternatives through increased state support. General forms of support that compensate for increased costs on a number of input goods are important for strengthening green industries in times of crisis, not to subsidize fossil fuels.
On Friday, I met LRF and a farmer at a farm in my home region. We talked quite a bit about how agriculture can contribute to the climate transition. The farm has made a number of adaptations, but the economy is a problem. For example, for economic reasons, they have been forced to switch from HVO to diesel in their agricultural machinery. It is nothing that they actually want on the farm, but the diesel is so much cheaper. LRF's representatives testified that it is common for farmers to have switched alternative fuels to diesel now that it is subsidized.
The government's proposal in the bill thus hinders Sweden's opportunities to carry out the necessary climate transition. It not only favors companies with high diesel consumption but also encourages companies to use diesel instead of more environmentally sustainable fuels. Companies that have taken measures to reduce their diesel consumption are disadvantaged by the proposal as the price difference between diesel and fossil-free alternatives increases further.
The proposal also does not take into account other price increases that affect farmers. This applies, for example, to the prices of artificial fertilizer, seed, and feed.
Vänsterpartiet believes that other forms of support should be introduced instead and that these should focus on strengthening the profitability in the agricultural sector. Support forms are needed that are decoupled from the consumption of fossil resources. After the extreme drought in 2018, several crisis supports were introduced for agriculture which were mainly based on area and animal units. The support thus had an increased accuracy to compensate for increased prices on all inputs and did not steer towards increased climate impact.
Such support would also prevent the risk that price increases on input goods within agriculture are passed on to the households' already heavily strained economy. An area and livestock unit-based support is therefore a better alternative. The crisis package implemented in 2019 is considered by many assessors to have generally functioned well.
The government is failing in initiatives to strengthen the agriculture's sustainability transition and our self-sufficiency of food.
Vänsterpartiet has, in its budget proposal for 2023, proposed increased national support for agriculture of over 1.5 billion SEK compared to the government. The investments include, among other things, support for measures that reduce dependence on imported inputs in agriculture and strengthen agriculture's collective benefit for the environment and climate. Together, these investments contribute to a more robust society that is better able to handle crisis situations and that reduces our climate and environmental impact. It is a support for agriculture that benefits both the user and the environment.
Per Söderlund (SD)
Madam Speaker! The temporarily increased reduction of carbon and energy tax, which applies until June 30 this year, on among other things diesel used in work machines and in ships and certain boats in professional agricultural, forestry, and aquaculture activities, is proposed to be extended so that an increased reduction shall also apply during the second half of 2023.
According to the proposal, the reduction of the carbon tax shall be granted at 2,491 SEK per cubic meter for diesel consumed during the period 1 July–31 December 2023. For such diesel consumption during the period, a reduction of the energy tax shall also be granted at 1,582 SEK per cubic meter.
The proposal entails changes to the Act on Energy Tax as well as to a previously decided amendment to that Act and is proposed to enter into force on 1 July 2023. Older provisions shall, however, still apply to fuel consumption that occurred before 1 July 2023.
The Government will also work to ensure that the tax on diesel for agriculture, forestry, and aquaculture remains at the EU minimum level during 2024 and 2025.
Madam Speaker! The temporarily increased reduction of these taxes was introduced against the background that the price of several important input goods within the mentioned industries had increased sharply, not least due to the war in Ukraine. It was also motivated by the need to maintain and strengthen Swedish food production during the extraordinary situation that prevailed due to events in the rest of the world. In the budget bill for 2023, the Government has assessed that these conditions will persist throughout 2023.
Not extending the reduction would mean that the costs for these industries would be passed on to the consumers, which would be very unfortunate under the economic conditions that currently prevail. It is not difficult to see that the measures, which are implemented early in the production chains, keep down price increases and thus inflation, something that I believe we all agree is something positive.
Madam Speaker! Miljöpartiet and Vänsterpartiet have submitted a motion to reject the bill and return to previous levels in the reduction of these taxes. It would hit the country's farmers and others who benefit from the reduction hard. The cost increases would affect all citizens who try to support Swedish food production by buying Swedish products.
In its motion, the Green Party also refers to the investigation *The Path towards fossil-independent agriculture*, SOU 2021:67. It is somewhat strange that it refers to that one because the following is established in the investigation: "Swedish production, in comparison with other countries, has low greenhouse gas emissions per produced unit."
The investigation also states that in the short term, by the year 2030, the greatest potential for reducing fossil fuel dependency lies in increasing the use of biofuels. We have all seen how the blending of precisely biofuels has increased fuel prices. One must also be aware that LRF and Maskinentreprenörerna, in their referral responses, conversely desire a reduction in the blending of biofuels.
Furthermore, it is noted in the investigation that "there is currently a lack of larger work machines that can be powered by electricity or other fuels such as biogas and ethanol. The investigation assesses that by 2045, a transition to self-driving work machines and new systems for cultivating the land, which are currently under development, should be a reality."
The investigation that the Green Party refers to thus confirms in principle that it is not possible to replace diesel-powered agricultural machinery with today's technology. The solutions lie more than 20 years into the future. One cannot turn a blind eye to the problems that, among others, the country's farmers are struggling with today while we stand here and discuss.
Miljöpartiet says they want to see a living agriculture that secures a high self-sufficiency of food, feed, energy, and raw materials in all of Sweden. These political proposals say something completely different.
Madam Speaker! In conclusion, I would like to move for the approval of the committee's proposal for a decision.
Helena Lindahl (C)
Madam Speaker! There is a risk that I will repeat a bit of what my colleagues have said. You must bear with it. Repetition is, after all, the mother of knowledge.
I and the Center Party think it is very good that the government wants to extend the temporary expansion of the tax relief. It actually expires on July 1, 2023. With the government's proposal, it will be for the rest of the year. The Center Party was involved in initiating the first relief. We are very happy that the government continues and that the challenges our Swedish farmers face are recognized. Many things are naturally caused by the war in Ukraine. It is very important that we continue to maintain Swedish food production.
Madam Speaker! What the Centre Party would also like is that the green industries continue to receive improved and long-term conditions. This is crucial for being able to make long-term investments, make wise decisions regarding future plans, and so on. Therefore, we would like the reduction of the tax on diesel used in agriculture, forestry, and aquaculture to be made permanent and phased over into a type of agricultural deduction through a kind of green tax shift. Such a permanent agricultural deduction would strengthen the companies' competitiveness and simultaneously accelerate the transition of Swedish agriculture. Furthermore, we would like to introduce a bio-premium for pure biofuels. The idea is that it should level the price difference that exists today between fossil and renewable fuels.
I would also like to say a few words about Swedish agriculture. A few weeks ago, a farmer contacted me. I see that he has also called and tried to get hold of me today. He is a dairy farmer living in Västerbotten. It is as if the farmers are being hit with blow after blow. Now, the compensation for the milk has also dropped very significantly. From what I last heard, I believe it was 73 or 74 öre less per liter, which means enormous amounts of money. This is because the dairies cannot accept as much milk; much of the cheese they produce is not sold, because people today are looking for lower prices, which is naturally understandable. The problem then becomes that the income becomes miserable for our farmers. Therefore, this temporarily increased reduction of the diesel cost is welcome.
I would like to appeal to all parties in here to do more, because it is needed. If it is that we want to secure and increase our own food production and consider food production here in Sweden to be part of our total defense, we must do more to save the farms that remain. You know yourselves—once a farm is shut down, it is not certain that it will be started up again. I would like to take this opportunity, Madam Speaker, to pass the baton to all comrades in this room.
I support the government's proposal but move for the adoption of reservation 2.
Crister Carlsson (M)
Madam Speaker! I want to begin by moving to approve the Committee on Taxation's proposal in the report Extension of the temporarily increased tax reduction on certain diesel use within agriculture, forestry, and aquaculture. This temporary reduction applies, among other things, to diesel consumed during the second half of 2023.
Why then this, Madam Speaker? Well, this temporary reduction of taxes on agricultural diesel was introduced because the price of several important input goods, that is, goods that are used and consumed in the production of other goods, has risen significantly. The circumstances that prevailed then – the war in Ukraine, inflation, and rising interest rates – also prevail today. We have also previously had a pandemic that affected the entire society. Unfortunately, the unrest seems to persist in Sweden and the rest of the world.
Agricultural diesel is an important input for agriculture, forestry, and water management, and it is expected to have a continued high price for the rest of the year. This support means that we are supporting domestic food production in a difficult time when food prices have already increased significantly. The Moderates and the Tidö parties support both households and companies through this difficult economic situation. This is the latest support measure in a series that includes, among other things, electricity support, gas support, reduced tax on fuels, and a reduction of the reduction obligation to the EU's minimum level.
This is extensive support that provides a tax relief of approximately 380 million during 2023. Approximately 25,000 companies within the agriculture, forestry, and aquaculture industries are estimated to be covered by the decision. Primarily smaller companies are covered, with the exception of certain larger companies within the forestry industry.
Madam Speaker! Another aspect we must also take into account is how this should be seen from a preparedness point of view. We must stand firm regarding the food supply in a crisis situation. Sweden has a self-sufficiency rate of approximately 50 percent, while, for example, Finland has a self-sufficiency rate of 80 percent. In the shorter perspective, this proposal can facilitate things, but in the long term, we must also look at other things from that point of view.
Madam Speaker! Some point out that we will get an increased impact on the climate through the decision. But one must know that Sweden, in an international comparison, is relatively climate-friendly and that Swedish milk and meat production has a significantly lower climate impact than production in other countries. Sweden should therefore, as far as possible, increase its market shares at the expense of countries where food that can be grown here in Sweden is produced in a more climate-intensive manner.
Work machines are mostly powered by fossil fuels today, and today there are far fewer alternatives for them than for lighter vehicles. Hopefully, we will get electric tractors at some point in the future, but unfortunately, that is not current. This temporary solution is very important for many companies but is judged to have a small or negligible impact on the climate in relation to total emissions, especially as the measure is temporary and the proposed extension of the tax reduction only applies during the second half of 2023.
Madam Speaker! As said, agricultural diesel in agriculture, forestry, and water management is an important input factor that is expected to have a continued high price during the rest of the year. This support means that we support domestic food production in a difficult time when food prices have already increased significantly. In addition to the companies being compensated, our households are also supported in a tough time.
Marielle Lahti (MP)
Madam Speaker! This will be a bit of a repetition of what the member from Vänsterpartiet said. We have a joint reservation, number 1, which I move to approve. I would also like to address some of the things that the colleague from Sverigedemokraterna raised.
Due to the cost increase that has hit Swedish agriculture as a result of Russia's full-scale invasion of Ukraine and which has entailed a very high cost level for many of agriculture's important input goods, which several speakers have said, we believe that it is justified to support agriculture. So that is absolutely clear. But it is important that we can find ways to support agriculture and at the same time continue the transition to a fossil-free agriculture with increased environmental and climate benefits.
Therefore, new forms of support are required that do not undermine the green transition and that contribute to the phasing out of fossil resources. We believe that the proposal for an extension will hinder Sweden's opportunities to carry out the climate transition.
It benefits companies with high consumption of diesel and does not take into account how affected they are by the ongoing price increase of other inputs, for example artificial fertilizer and feed.
There are, therefore, more areas beyond fuel where our farms need support. That is why we want an agricultural deduction. It is quite rightly as the member before me said that we refer to a previous report. We believe very much in it.
We need to have a high degree of self-sufficiency of food in Sweden. It is ultimately a security issue. But we must also take into account that we are not starting from a zero position.
There are companies and farms that have taken measures to reduce their consumption of diesel. They are now directly disadvantaged by the government's proposal because the price difference between diesel and fossil-free alternatives is increasing further.
Therefore, there is a risk of locking agriculture into a dependency on imported inputs, which makes us more vulnerable in crisis situations.
Cecilia Engström (KD)
Madam Speaker! Free and independent Ukraine is subjected to a war of aggression from Russia. The European energy crisis that has followed in its wake contributes to the fact that fuel prices remain high. Sweden has chosen the only morally right course in this international crisis: to wholeheartedly and in solidarity support the people of Ukraine. Aggression from other countries must never pay off.
Madam Speaker! Unfortunately, we therefore need to make a decision regarding an extension for the remainder of the year of the increased tax reduction on diesel used in work machines used in agriculture, forestry, and water management.
The consequence of high fuel prices is that Sweden's farmers will be pressured even harder. The possibility for families to put Swedish meat on the grill this summer deteriorates when food prices become high.
Swedish agriculture and forestry are industries that employ tens of thousands of people in Sweden and contribute to the fact that people can live and reside even in the countryside. They contribute to the fact that future generations can take part in what we consider a given, the open Swedish landscape.
Madam Speaker! The Christian Democrats want to continue to safeguard Swedish food production, not least in order to increase our self-sufficiency. This is important from a security perspective but also to reduce the overconsumption of antibiotics and because our Swedish agriculture is relatively climate-friendly.
Extension of the temporarily increased tax reduction on certain diesel use within agriculture, forestry, and aquaculture
The climate efficiency in Swedish agriculture is high in an international perspective. The production of food from Swedish agriculture should therefore increase and take market shares from food produced in more climate-burdening ways and imported to Sweden. That Swedish agriculture is also a role model in terms of animal welfare is something that is almost always forgotten in the debate.
Madam Speaker! We Christian Democrats are proud to be involved in and contributing to increasing Swedish agriculture's competitiveness. In this way, we can make a contribution to the climate, contribute to the survival of Swedish farming, increase the self-sufficiency rate, make a stand for animal welfare, and counteract the sharp increase in antibiotic resistance that exists in the world's large-scale agricultural industry.
By contributing to reduced taxes for Swedish agriculture, we lower the cost level and simultaneously encourage the possibility for Swedish consumers and families with children to also be able to put Swedish meat on the grill in the future.
Madam Speaker! I vote in favor of the bill and against the reservations.
The deliberation was hereby concluded.
Source: The Swedish Parliament. The speeches come from the open data of the Riksdag, translated into English by AI, which may contain errors.