Background information

In the face of rising fuel prices due to Russia’s war of aggression against Ukraine, The Swedish parliament passed an amendment to the Act for Travel Deduction (2022:1071) to increase the travel deduction for work-related travel. Further, it has been agreed that the standard amounts that can be deducted for travel to work by private car or concessionary car will be increased to better reflect contemporary costs. However, no changes will be made to the current rules for travel by electric cars. The legislative changes entered into force on 1 January 2023.

Content of measure

The deduction for journeys to work, business trips and journeys home by private car will be increased from SEK 18.50 to SEK 25 per kilometre. The deduction for travel by company car will be increased from SEK 6.50 and SEK 9.50 to SEK 12 per kilometre. However, the amount remains SEK 9.50 per kilometre for cars powered entirely by electricity. The travel deduction is granted by the Swedish tax agency Skatteverket.

The Ministry of Finance evaluates that raising the reimbursement levels for travel by private car and concessionary car is estimated to reduce tax revenues by a total of around SEK 1.6 billion in 2023. The introduction of the travel deduction is estimated to permanently reduce municipal tax revenues by SEK 6.8 billion per year from 2023.

Use of measure

In 2019, there were 873,000 recipients of travel deductions of work related travel.

Target groups

Workers	Businesses	Citizens
Applies to all workers	Does not apply to businesses	Does not apply to citizens

Actors and funding

Actors	Funding
National government Public support service providers	Local funds

Social partners

Social partners' role in designing the measure and form of involvement:

	Trade unions	Employers' organisations
Role	Consulted	Consulted
Form	Direct consultation outside a formal body	Direct consultation outside a formal body

Social partners' role in the implementation, monitoring and assessment phase:

• No involvement
• Main level of involvement: Peak or cross-sectoral level

Involvement

Social partners were invited to leave statements in the preparation of the amendment.

Views and reactions

Confederation of Swedish Enterprise [Svenskt näringsliv] supports the amendment. The peak-level trade union LO criticised the proposal, arguing that the model of travel deductions already primarily benefits high-income earners. LO also found the measure to be problematic from an environmental perspective.

Sources

• 01 October 2022: Maintaining the travel deduction with some enhancements for work travel by car (Bibehållet reseavdrag med vissa förstärkningar för arbetsresor med bil) (www.regeringen.se)