Political Economy


Sweden's Moderate Party sees heat and now starts talking of tax reduction

Saturday, 17 August 2013
The conservative Moderate party wants to position itself properly for the next elections and has upped its antic by talking tax reduction, as the next budget is being prepared. Itis  leader who happens to be the Prime Minister, Fredrik Reinfeldt, poked fun on the opposition and described them as an opposition with no direction for co-operation.
Fredrik Reinfeldt knows that he will work with the far right Sweden Democrats in implementing what is described as the fifth earned income tax reduction next year which the parties in that the Alliance coalition  negotiations for the autumn budget. The Moderate party wants to see the height marker for high earner taxes and then tax cuts for seniors.

Fredrik Reinfeldt identified four reason why his tax cut plan is idea as he gave his summer talk  Gustavsberg outside Stockholm today. The reason are that

  • The proposals would provide jobs and strengthen momentum for work.
  • Proposals improves the disposable income for normal folks.
  • The proposals are good for the Swedish economy.
  • The proposals are promises that were made to voters prior to the last election.

"People in ordinary income positions will get another few hundred more a month and that is job creation. It is also good to deliver the promise to voters, "he said referring to the proposals contained in the Alliance's election manifesto in 2010 and the Autumn Budget is the last chance to implement them for his term.

The promise had already been presented in the 2010 election campaign but has not been implemented. One reason, according to the government, has been the difficult economic situation. Another reason has been uncertainty about whether the government could push it through parliament.

The fifth earned tax credit will cost some Skr 12 billion. "We use the strength of the Swedish economy to secure jobs, "said the leader of the Moderate Party in his speech and pointed out that it is taking place in a Europe that has been characterized by recession for several years.
Swedish Prime Minister, Fredrik Reinfeldt who is also teh leader of the Moderate PartySwedish Prime Minister Fredrik Reinfeldt, leader of the Moderate Party on Saturday /image Scancomark
Raising the threshold for the tax cuts would affect 1 million workers, according to Reinfeldt, and cost around Skr3 billion to implement. The gain is great and would hit Skr337 per month at an income level equal to the average salary for a high school teacher.
The party would also cut taxes for seniors further, which will cost an estimated Skr1 billion.
"The strong Swedish economy will now be used to implement what we asked from voters' support in the 2010 election," says Fredrik Reinfeldt.
"There is a way to use a strong economy that provides incentives for new jobs. The second reason is that it will lead to the improvements of the incomes of the common person. Anyone earning under Skr38,500 a month will have a reinforcement with a whole extra month after tax.
The far right, Sweden Democrats have said they support a fifth earned income tax credit and the Prime Minister himself claims that the economic situation now allows for additional tax cuts.

Slowly he turned and swiped at the Social Democrats and its allies - "they would not  tell you what together they want to offer, but they all have suggestions on ways that are harmful to Sweden and the Swedish economy,"  he said.
Fredrik Reinfeldt went further, poked for fun on the Red-Green opposition, and described them as " a poorly prepared orchestra."
"There is no sweet music coming from the opposite directions for they have never practiced together. Gustav Fridolin with the solo trumpet to the song "Look at me." Jonas Sjöstedt on percussion beats on anything that moves, to anything that can possibly be International."Prime Minister Fredrik ReinfeldtSwedish Prime Minister Fredrik Reinfeldt and head of the Moderate party on Saturday/ image Scancomark
"And at the back, in the hope that no one sees him, Stefan Löfven playing the triangle with a match," said leader of the Moderate party  who also vowed to "take the battle to the Red-Green cooperation that does not exist."

The speech was a prelude to the new parliamentary year, but also a kickoff for the election year of 2014, with the election to the European Parliament in May and the general election in September.

The question that many will be asking now is whether Mr Fredrik Reinfeldt is coming out as a man in distress as shown on the opinion polls, Swedish people seem to be moving away from the idea of persistent tax cuts which is heavily heating the lower earners with lots of burdens.

Hopefully in the coming days and months more will be discussed about the growing incomes disparity in Sweden, the healthcare system that is failing for the first time in Swedish history, too much privatisation of welfare services including schools and the massive profiteering from public services. These are problems, which the current government now owns.
by Scancomark.com Team

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