Sweden’s Tidö parties, together with the Sweden Democrats, have presented their latest budget measures, centered on tax relief for workers and pensioners. The package stops short of raising child benefits but directs significant resources toward households facing tighter finances.
Earned Income Tax Credit Expanded
A key element is the tenth increase in the earned income tax credit. For someone earning SEK 300,000 a year, this means roughly SEK 1,800 in extra disposable income in 2025, about SEK 150 a month. At an annual income of SEK 500,000 or more, the relief rises to around SEK 4,700, or SEK 400 per month. The measure carries a price tag of SEK 17.1 billion.
Pensioners Benefit from Higher Basic Deduction
Pensioners will see their basic deduction raised. For example, a pensioner with SEK 25,000 in monthly income will gain SEK 148 a month. Those with higher pensions, around SEK 62,500, stand to benefit most in absolute terms, with SEK 424 more per month. The adjustment costs SEK 4.28 billion.
Additional Measures: Energy and Social Contributions
Beyond income tax relief, the government is lowering the electricity tax by almost 10 öre per kilowatt hour and introducing a new high-cost protection against surging energy prices. In total, these changes and other adjustments add up to just over SEK 30 billion in support, according to Finance Minister Elisabeth Svantesson.
Tax on sickness and activity compensation will also be reduced, removing the gap between these benefits and earned income taxation. On average, affected individuals will see SEK 1,800 less in annual tax.
Lower Childcare Fees
Preschool and after-school care fees are also targeted. A family with two children can expect SEK 375 more per month after reductions in maximum charges, a system in place since 2001.
Impact on a Typical Household
The government highlights a dual-income family—one police officer, one nurse—as an example. Together, they would see SEK 1,800 in monthly relief, broken down as:
- SEK 802 from reduced labor tax
- SEK 545 from lower food VAT
- SEK 375 from childcare fee reductions
- SEK 85 from lower electricity tax
By 2026, this household would have over SEK 3,500 more per month compared to 2022.
No Increase in Child Benefits
One notable omission is child benefit, which remains unchanged despite earlier speculation.