Taxes in Sweden
Here's your quick guide to the Swedish tax system, five pointers.
Tax rates for individuals
In Sweden, most people pay only local tax – ranging between 29.08 and 35.15 per cent depending on municipality – on their annual income. Earners above a certain income threshold set by the Tax Agency (link in Swedish) also pay 20 per cent state tax.
The Swedish tax system includes a so-called basic deduction, a sum that is exempt from the taxable income. The sum differs depending on whether a person is under or over 65, see link above.
For capital gains, the tax rate is around 30 per cent.
Since 2005, there is no inheritance tax in Sweden, and since 2007, there is no wealth tax.
Sweden currently levies a corporate income tax of 20.6 per cent, which is just below the EU average (20.7 per cent). It is also lower than the OECD average (22.8 per cent).
Sweden has gradually lowered its corporate tax since 2009, when it was at 28 per cent, to today’s rate. These steps have been taken both by centre–right and centre–left governments.
Value-added tax (VAT) in Swedish translates as mervärdesskatt, but is usually called moms.
The standard VAT rate for goods and services in Sweden is 25 per cent, but there are also certain reduced rates of 12 per cent (e.g. foodstuffs) and 6 percent (e.g. books, newspapers, passenger transport within Sweden).
The Swedish Tax Agency's website has an overview of which VAT rates apply to which goods and services.
A tax-financed infrastructure
In 2020, 42.8 per cent of Sweden’s GDP went to taxes. The Swedish welfare system is based on the general principle that everyone contributes, and everyone gets equal access to the same safety net and public services.
The Swedish Tax Agency
Should you move to Sweden, your everyday life here will involve the Swedish Tax Agency at some point. It is not only the government agency in charge of collecting taxes, it also manages civil registration of private individuals in Sweden.
Sweden has around 8 million taxable people, and a majority of these submit their annual tax return electronically. In 2021, around 6.7 million did (link in Swedish).