"According to a report from Sweden's public broadcaster SVT, Finance Minister Elisabeth Svantesson will propose slashing VAT (moms in Swedish) on food from 12 percent to 6 percent, with the change coming into force on April 1st next year and applying for the rest of 2026 and 2027."
"The tax cut will cost 16 billion kronor in 2026 and 21 billion kronor in 2027 in foregone revenue and is intended to increase the buying power of Swedish households, boosting consumption and stimulating economic growth."
"The government will instruct the Swedish Competition Authority to check that the tax cut is fully reflected in prices at the till and to ensure that food retailers and wholesalers do not use the tax cut to expand their margins."
""We need to get consumption going," Damberg said, explaining the U-turn. "Households still feel battered by inflation and high interest rates. People need to feel a bit more secure about their household finances. Food prices are a really important part of that.""
The Swedish government plans to cut VAT on food from 12 percent to 6 percent, effective April 1st and applying for the remainder of 2026 and all of 2027. The measure was proposed by Finance Minister Elisabeth Svantesson with backing from Sweden Democrat leader Jimmie Åkesson and mirrored in a Social Democrat shadow budget. The tax cut is projected to cost 16 billion kronor in 2026 and 21 billion kronor in 2027 in foregone revenue. The aim is to increase households' buying power, boost consumption and stimulate economic growth while the Competition Authority will monitor price pass-through to prevent margin expansion. The Social Democrats also plan a 200-kronor monthly child benefit increase.
Read at www.thelocal.se
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