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full screen Elisabeth Svantesson (M). Photo: Claudio Bresciani/TT / TT News Agency
Today, Finance Minister Elisabeth Svantesson (M) presents the government’s budget proposal for next year.
As usual, large parts of the reforms have been presented in advance.
– This year, households have been prioritized, unlike in recent years, says Arturo Arques, Swedbank and the savings banks’ private economist.
Until yesterday, the government had revealed budget reforms totaling SEK 60 million, of which roughly half consists of investment in households.
– The winners are high income earners with savings capital and a car. For those who have a salary of SEK 80,000 a month, SEK 150,000 on their ISK and who drive 1,500 miles a year with their petrol car, these proposals will mean a total tax reduction of SEK 17,412 for 2025. That is a lot of money, says Arturo Arques.
– The losers definitely include low-income earners with consumer credit. It is not a priority group.
– The fact that the interest deduction for this type of loan is being phased out is because they are expensive and generally problematic. You simply want to get people to stop using them.
Here are some of the key proposals in the budget:
• The employment tax deduction is increased. In combination with the annual indexation (calculation in line with inflation), this means an average tax reduction of SEK 2,600 per person per year.
• The increased basic deduction for pensioners is increased in proportion to the employment tax deduction. In combination with the annual calculation of the deduction, it will mean a tax reduction of approximately SEK 1,400 per year.
• The phasing out of the employment tax credit is abolished, which means that the marginal tax for high income earners is reduced by 3 percentage points, from 55 to 52 percent. The reform affects people with annual incomes of SEK 778,000–2 million.
• The tax on investment savings accounts, ISK, is abolished at the turn of the year for savings amounts up to SEK 150,000. For the median saver with SEK 78,000 in the account, this means a tax reduction of SEK 750 per year. As of 2026, it is proposed that the tax-free limit be raised to SEK 300,000. 3.5 million people save in an ISK account, of which three out of four have a savings capital of less than SEK 300,000.
• The tax on petrol and diesel is reduced, while new EU rules mean that the duty to reduce (the mixing of biofuel) increases. The tax reduction is intended to compensate for the price increase that the increased reduction obligation entails.
• The temporary supplementary allowance for families with children with housing allowance is extended until 30 June 2025.
• The interest deduction for unsecured loans is phased out, so that next year it will be halved and in 2026 it will be removed completely.
FACTS Other economic changes next year
In addition to the regular reforms, calculations are made as usual of various limit values and contributions.
• The cut-off point for state income tax is raised from SEK 51,275 to SEK 53,590 a month. The enumeration is done automatically every year but was stopped last year due to the economic situation.
• The guarantee pension is added up by 2.6 percent. This means that the maximum amount for unmarried people is increased by SEK 304 per month to SEK 11,907. The calculation of the guaranteed pension is governed by the rate of inflation. In the last two years, the figures have therefore been record high: 8.7 and 9.1 percent, respectively.
Read moreFACTS Facts: guarantee pensioners
check The guarantee pensioner in the example is estimated to receive SEK 204 more per month after tax. However, it must be said that this type of household, with a full guaranteed pension and full housing allowance, is extremely unusual.
check Just over 1 million people receive a guaranteed pension, most of whom only receive a small amount. Of the 74,000 who receive the maximum amount, 21,000 of them lack an income-based pension and therefore only receive a guaranteed pension.
check Most of the 306,000 who receive housing allowance for pensioners, BTP, only receive a small amount. The average amount is currently SEK 3,500 a month.
check Only 7,600 people (about 0.3% of all pensioners) receive full basic protection, i.e. maximum housing allowance and maximum guarantee pension.
Read moreFACTS How households are affected
About the examples: The calculations are made by Swedbank and are based on the budget proposals presented in advance. The income limits for the various tax reductions are still unknown. The calculations are therefore more to be considered as indications of how households are affected, rather than exact calculations.
Assumptions: The typical single-family household is assumed to live in a villa purchased for SEK 5.1 million with an 85 percent loan-to-value ratio. The mortgage interest rate is estimated to be 4.74 percent in January 2025. The rent increase is estimated to be 5 percent in 2025.
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