Reporting of tax expenditures 2026
Translated from Swedish by AI; the translation may contain errors. The Swedish text is the original.
Summary AI, written in advance
The debate concerned the reporting of tax expenditures in 2026, which means indirect support to companies and households through special rules in the tax legislation 1. S argues that tax expenditures are a cost to society and that they should be scrutinized in the same way as appropriations in the state budget 1. S criticizes the temporary reduction of employer contributions for young people as a costly measure that does not solve the weak demand in the economy 1. S views the abolition of the funkis tax positively 1. S believes that the government's policy favors high-income earners and increases inequality, while S wants a fair tax system that strengthens cohesion 1.
Written by AI in advance and may contain errors. The numbers lead to the speech a statement builds on; check against the text below.
Ida Ekeroth Clausson (S)
Madam Speaker! When one reads the list of speakers for today's debate on tax expenditures, it becomes clear that this debate is not the one that arouses the most interest, especially not after today's budget debate.
They do belong together. But unlike the expenditures that are visible in the state budget, for example expenditures for school, healthcare, infrastructure or defense, tax expenditures are a kind of hidden support. It concerns special rules in the tax legislation that lead to the state receiving less revenue.
The reporting of tax expenditures began in the mid-1990s in connection with the introduction of a new budget process. Over the years, it has developed into an increasingly larger process with the aim of clarifying the state support to companies and households that the tax expenditures represent, so that these can be scrutinized in the same way as the appropriations on the expenditure side of the state budget.
Unlike in the budget, it is therefore not money that is paid out but money that never comes in, but the effect is the same. It becomes a cost for society.
The report provides a consolidated overview of the indirect support to companies and households that is left on the revenue side of the budget. In many cases, the report can result in useful price tags on tax-advantaged treatment that can contribute to the assessment of the expenditure needs within the various expenditure areas when the budget is finalized during the autumn.
Social economic efficiency means that society's resources are used in the best way to create as high a welfare in society as possible. Taxes, regardless of whether they are uniform or not, usually cause distortions and an inefficient distribution of resources in society. In some cases, deviations from uniform taxation can, at least theoretically, improve efficiency and thus raise the welfare in society. Deviations and the tax expenditures that arise can then be considered socially economically justified. An important question is therefore whether a tax expenditure can be considered to improve social economic efficiency and thus welfare.
In this year's report on tax expenditures, a temporarily reduced employer contribution for 19–23-year-olds has been added. From 1 April 2026 up to and including 30 September 2027, a reduction of the total withdrawal of employer contributions and a general wage tax on compensation is granted to persons who, at the beginning of the year, have turned 18 but are not 23 years old.
Madam Speaker! The temporary reduction of employer contributions for young people involves a cost of 7 billion kronor during the year. Research shows that broad and general reductions often lead to the state subsidizing jobs that would have been created anyway, without the support. An evaluation from the Institute for Labour Market and Education Policy of the previous reduction did indeed show that employment increased, but also that the cost for a new job amounted to approximately 1 million kronor.
This is a very costly measure. For 1 million kronor, one could instead hire two nursing assistants in elderly care.
The Swedish economy's greatest challenge today is not primarily the cost of hiring young people. The real problem is the weak demand. Many companies are delaying new hires and investments, while municipalities and regions are under severe economic pressure. When the economy is running at low speed, it is not enough merely to lower the cost of hiring. Measures are also required to strengthen activity in the entire economy.
Employer contributions are also more than just an expense for employers. They constitute a central financing of our collective security systems such as pensions, health insurance, and parental insurance. Those who want to lower employer contributions must therefore also be able to account for how the financing of these important welfare systems shall be ensured.
Madam Speaker! A tax expenditure that has been added and which we Social Democrats view more positively is the tax reduction for persons with sickness and activity compensation. The rule change means that the tax reduction for persons with sickness and activity compensation is raised to the same level as the job tax credit. The deeply unjust so-called "funkisskatten" should never have been introduced, but it is welcome that it is now completely abolished after years of pointing out from us Social Democrats.
Madam Speaker! Tax expenditures can be designed with different purposes and from several perspectives. They can be used to encourage behaviors that society wants to promote and to strengthen confidence in the tax system by making it more understandable and fair. From a growth and efficiency perspective, tax expenditures can be justified to stimulate innovation, investments, and more jobs. One example is the rot deduction, which in the best case can contribute to reducing the occurrence of undeclared work within the construction sector and, as a temporary cyclical measure, contribute to economic growth during poorer times.
From a distributional perspective, tax expenditures can be used to reduce economic inequalities between people, but they can also have the opposite effect. This is where we see the problem with the policy pursued by the bourgeois government together with the Sverigedemokraterna. From a distributional policy perspective, the government's collective policy is largely aimed at favoring groups that already have high incomes and significant assets. Instead of safeguarding cohesion, representing broad wage-earner groups, and reducing the large differences in society, they actively contribute to increasing the gaps. The tax cuts are primarily directed at those who are already well-off financially.
We Social Democrats stand for a different view of society and a different view of humanity. This is also reflected in how we design our policies, not least in the tax policy. We want to see a tax system that is open, fair and easy to understand, a system based on the idea that everyone contributes according to their ability and where resources are distributed in a way that strengthens cohesion.
Tax expenditures can fulfill an important function, but they can also be used with deliberation, restrictively and with the goal of strengthening the common welfare and social cohesion, not weakening it.
Politics is ultimately about priorities. We Social Democrats choose a Sweden that holds together, not a Sweden where the distance between people grows.
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.