Value-added tax (VAT)
The Swedish VAT system is harmonised with the EU rules. The general VAT rate of 25% is chargeable on most goods and services. Reduced rates apply to a few goods and services, such as hotel accommodation, foodstuffs (excluding alcoholic beverages), restaurant meals, and low or non-alcoholic drinks (12%), as well as newspapers, magazines, books, e-books, passenger transport, maps, musical notes, some cultural services, transport in ski lifts, etc. (6%). Certain financial and insurance services are exempted from VAT.
VAT returns are filed and tax is paid monthly or quarterly. VAT returns must be filed monthly if the VATable turnover is estimated at more than 40 million Swedish kronor (SEK) (estimated yearly sales excluding any reverse charge or import acquisitions). Companies with VATable turnover below SEK 40 million report VAT quarterly or may choose to report VAT on a monthly basis. For companies with a turnover of less than SEK 1 million, VAT is reported on a yearly basis in the VAT return, and these companies may also choose to report VAT quarterly or on a monthly basis.
New VAT regulations for businesses with call-off stocks in other EU countries
For businesses with call-off stocks in other EU countries, that submits EC Sales Lists, new rules have been introduced. The new rules imply that the business, which owns supplies and transfers them, does not under certain conditions have to be VAT registered in the country where the call-off stock warehouse is located, have to submit an EC Sales List on two occasions per year, the first when the goods are transferred and the second when the sale takes place.
New regulations relating to chain transactions
New regulations relating to chain transactions stipulate that in cases of chain transactions, several consecutive sales of the same product take place where the product is subject to a single cross-border transport between EU countries, the transport may only be attributed to one of the turnovers and the rules also regulate the place of supply for VAT purposes.
New VAT rates on electronic publications
The Swedish Tax Agency considers after a change of the law that a production of an electronic publication may be subject to the lower tax rate of six (6) percent. An assessment of whether it is an electronic publication or some other type of service must be made in a similar way as with printed products, i.e. if the main part of the supply is the actual production of the product for someone else.
As a member of the European Union, Sweden is also part of the Customs union enforcing the Community Customs code. Most EU Customs duties are calculated as a percentage of the value of the goods being imported. All imported goods must be classified according to the EU Customs tariff (TARIC), and the duty rates applied depend on the economic sensitivity of the goods. The actual duty rate to be applied also depends on other factors, such as the country of origin of the product and any free trade agreements that may be applicable.
The three main Swedish excise duties are harmonised with EU rules. These are the alcohol tax, the tobacco tax, and the tax on fuels and electricity. There are, however, still differences in local legislation between the member states, and the taxation of fuels is partly EU harmonised, partly national. Fuels are subject to energy tax, carbon dioxide tax, and sulphur tax. Depending on the use of fuels, taxes may be partly or fully reduced. For bio-fuels, certain exemptions for fuels consumed for heating purposes may also apply.
Since July 2017 an excise duty on certain electronics and household appliances is applied. From October 2020 it also applies to distance selling of these products to Sweden.
Real estate tax
The annual real estate tax rate on business premises is 1% of the property tax assessment value. For industrial property, the tax rate is 0.5%. Other rates exist for special property.
Stamp duty at 4.25% is levied on a direct transfer of real estate. The tax base consists of the highest of the purchase consideration or the tax assessed value of the real estate the year before the transfer. Stamp duty on an intra-group transfer of real estate may be deferred as long as the real estate remains within the group.
There are no payroll taxes other than social fees (see below).
Mandatory social security charges payable by employers on remuneration to employees (or by the self-employed) are levied at approximately 31%. A reduced rate is applicable for people over the age of 65 and under 18. Social security charges are deductible for corporate tax purposes.
Pension benefits beyond the mandatory system are customary amongst most Swedish employers. A special salary tax is levied at approximately 24% on these additional pension premiums/commitments and is deductible for corporate tax purposes.