Increased globalisation and rapid technological development have significantly changed the Swedish economy. How do these changes affect the efficiency of the tax system and its redistributive function? Time frame 2019–2022.

Contacts

Research Director: Stefan Sandström, stefan.sandstrom@sns.se
Project manager: Emelie Lekebjer, emelie.lekebjer@sns.se, +46 (0) 737 53 32 07.


Taxation today and in the future

The revenues of the Swedish Tax Agency essentially derive from taxes on labour and taxes on consumption. Public discussion sometimes revolves around the question of whether today’s tax bases are the most suitable in terms of efficiency and distribution. Occasionally, policymakers put forward proposals for new tax bases, such as a robot tax, financial tax, inheritance and gift tax, and wealth tax. Questions that will be asked within the framework of the project are:

– Should labour, capital and consumption be taxed differently in the future?

– How can tax revenue be guaranteed at the level needed to finance public expenditure?

International harmonisation of tax regulations

Member states of the OECD and the EU have launched several joint projects during the last few years, with the aim of redrawing the field of international taxation. The major economies are driving these developments, and they are expected to be of significant consequence for Swedish firms, private individuals, and Sweden’s public finances.

States have also entered into a number of bilateral information-sharing agreements aimed at counteracting illegal tax evasion, which prompts the following question:

– How do new international tax rules affect Swedish companies and their competitive position, as well as tax revenues in Sweden?

Globalisation increases competitive position

The Swedish economy has increased rapidly its integration with the global economy, and Swedish companies now face challenges from significantly more foreign competitors. A tax system that encourages enterprise, innovation, and some risk-taking is important in a globalised world. Globalisation also makes the international market for highly skilled labour more competitive. We must therefore ask the following question:

– How can the tax system be designed to increase companies’ competitiveness and motivate people to acquire higher education and increase participation in the labour market?

Digitalisation, technological development and changed consumption patterns

When taxes were last radically reformed in Sweden almost 30 years ago, the Internet was in its infancy. Today, the entire economy is becoming rapidly digitalised. For Swedish industry, technological advances involve significant investment and, consequently, also significant risk-taking. Digitalisation has also given rise to new business models incorporating the sharing economy. Companies offering new types of digital solutions thus compete with companies operating in the traditional economy, and it is sometimes unclear how these new actors should be taxed. Possible questions include:

– How should the tax system handle rising levels of e-commerce and the expansion of the sharing economy?

– What are the likely broad tax bases in the future, assuming further globalisation and technological development?


Publications

The Swedish Dual Income Tax System and the Splitting Rules Yesterday, Today, and in the Future
How Should Consumption Be Taxed
Consumption Taxation of Digital Services, English summary
Carbon dioxide emissions, carbon dioxide tax and emissions trading
Swedish Energy and Environmental Taxation – A Reform Proposal
A New Taxation of Housing
Taxation of profits in the energy sector
EU and Swedish Corporate Taxation
SNS Research Brief 60. Lessons from the Swedish Inheritance Tax
Swedish Taxes in International Comparison
Lower payroll taxes for the young


Seminars

The dual income tax system 2021.09.08
How Should Consumption Be Taxed 2021.06.02
Consumption Taxation of Digital Services 2021.04.21
Carbon dioxide emissions, carbon dioxide tax and emissions trading 2020.12.02
Swedish Energy and Environmental Taxation – A Reform Proposal 2020.11.04
A New Taxation of Housing 2020.10.13
Taxation of profits in the energy sector 2020.05.14
EU and Swedish Corporate Taxation 2019.11.29
Lessons from the Swedish Inheritance Tax 2019.11.05
Swedish Taxes in International Comparison 2019.09.04
Proposal for new income taxation 2019.06.04
Lower payroll taxes for the young 2019.05.15


On-going studies

Taxation of the municipal sector

Thomas Aronsson and Magnus Wikström, both professors of Economics, Umeå School of Business, Umeå University. Publication 2021.

The Effects of Corporate Taxes on Small Firms

Jarkko Harju, VATT Institute for Economic Research, Aliisa Koivisto, VATT Institute for Economic Research and University of Tuomas Matikka, VATT Institute for Economic Research. Publication 2022.

Taxes in a globalised world

Åsa Hansson, Associate Professor of Economics, Lund University. Publication 2022.


Funding and reference group

AstraZeneca, Bostadsrätterna, EQT, The Swedish National Financial Management Authority (ESV), FAR, Investor, The National Institute of Economic Research (NIER), The Federation of Swedish Farmers (LRF), The Swedish Trade Union Confederation (LO), Mellby Gård, Riksförbundet M Sverige, Swedish Private Equity & Venture Capital Association (SVCA), The Swedish Confederation of Professional Associations (Saco), Skatterättsnämnden, The Swedish Tax Agency, Spotify, Stora Enso, The Confederation of Swedish Enterprise, The Swedish Confederation of Professional Employees (TCO), The Association of Swedish Engineering Industries, Uniper, Vattenfall.