Eurofound's EU PolicyWatch collates information on the responses of government and social partners to the COVID-19 crisis, the war in Ukraine, rising inflation, as well as gathering examples of company practices aimed at mitigating the social and economic impacts.
Factsheet for measure SE-2022-1/2375 – Updated – measures in Sweden
|Country||Sweden , applies nationwide|
|Time period||Temporary, 01 January 2022 – 31 December 2023|
|Context||War in Ukraine|
|Type||Legislations or other statutory regulations|
Responses to inflation
– Support for fuel expenses
|Author||Anna-Karin Gustafsson (Oxford Research) and Eurofound|
|Measure added||20 May 2022 (updated 06 July 2023)|
Due to the current cost of energy and raw materials, the viability of many agricultural companies’ operations in Sweden is threatened. The situation has been exacerbated by the war in Ukraine. To support the companies’ survival as well as to secure continued domestic food production in Sweden, the government has decided on financial support for the agriculture, forestry, fisheries and aquaculture enterprises in terms of tax reduction on diesel. The tax reduction increase requires an amendment in the The Act on Tax on Energy 1994:1776 (Lag om skatt på energi).
This measure is closely linked with Additional support for agricultural and fishery enterprises , as they are both part of the same package.
The government proposed in their spring budget amendment to temporarily increase the tax reduction for diesel used in agriculture, forestry, and aquaculture by 2 SEK per litre, on top of the pre-existing tax reduction. The estimated fiscal cost was SEK 700 million.
The measure is part of a support package valued up to SEK 1 billion. The package also included a direct subsidy to some agricultural producers .
Due to war in Ukraine, prices for agricultural inputs continue at a high level. Thus, the government of Sweden has expanded the tax reduction on diesel making it valid retroactively. Thus, eligible producers will get an enhanced tax refund on their diesel use over the period 1 January 2022 to 30 June 2023. The amendment is planned to enter into force on 1 July 2022. The tax refunds are expected to have a fiscal burden of SEK 400 million.
The government estimates that around 26,000 businesses in the agricultural, forestry and aquaculture sectors are covered by the reduction, most of which are small enterprises.
In March 2023, when the measure was extended until the end of the year, the government announced that the tax relief would affect around 25,000 businesses.
|Does not apply to workers||
Sector specific set of companies
||Does not apply to citizens|
Social partners' role in designing the measure and form of involvement:
|Trade unions||Employers' organisations|
|Form||Direct consultation outside a formal body||Direct consultation outside a formal body|
Social partners' role in the implementation, monitoring and assessment phase:
Social partners were invited to leave a statement.
The Confederation of Swedish Enterprise [Svenskt Näringsliv] approves of the measure and argues that from a climate perspective it is well balanced considering that Sweden otherwise would have to rely on food imports.
|Economic area||Sector (NACE level 2)|
|A - Agriculture, Forestry And Fishing||A1 Crop and animal production, hunting and related service activities|
|A2 Forestry and logging|
|A3 Fishing and aquaculture|
This case is not occupation-specific.
Eurofound (2022), Lower tax on diesel for companies in forestry, agriculture and aquaculture, measure SE-2022-1/2375 (measures in Sweden), EU PolicyWatch, Dublin, https://static.eurofound.europa.eu/covid19db/cases/SE-2022-1_2375.html
30 January 2023
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Disclaimer: This information has not been subject to the full Eurofound evaluation, editorial and publication process.