What do you get for your tax money?
Sweden has a 25% value added tax or consumption tax which is high from an international stand-point. But high taxes are not necessarily high if you are getting your money’s worth.
• There is universal health care in Sweden. You do not pay anything unless you have to go to the doctor. In that case, you pay a small amount per visit.
• Day care is heavily subsidised. It costs about $120 a month, but you recieve a monthly child benefit from the government which covers those costs. So day care is basically free.
• University studies are free if you have a temporary Swedish residence permit that was granted on the basis of something other than study.
Sweden spends more of its gross domestic product (GDP) on social services than any other country in the world, according to recent OECD statistics. The money goes to fully tax-financed education and heavily tax-subsidised health care, among other things. Everyone who lives in Sweden is entitled to extensive tax-funded services and benefits. This explains why Swedish taxes are known to be relatively high. All Swedish residents have access to medical services, education is tax financed from the age of six and all elderly people receive a basic pension guaranteed by the state. For those who lose their jobs, unemployment insurance is available, and many continuing education and retraining programmes are entirely tax-financed. On top of these basic benefits, many workers enjoy other advantages based on their salary, sector or workplace. Certain white-collar workers or management-level employees, for example, can earn significantly higher pensions due to the nature of their work. To support these social services, all levels of government receive their share of tax revenues. This includes the municipality (kommunen), the county (landstinget) and the national government (staten). All taxes are collected by the Swedish Tax Agency. Paying taxes in Sweden is very straightforward: employers pay payroll taxes on top of your salary every month, income taxes are deducted directly from your salary and value-added taxes are included in the price of food, goods and services. If everything appears correct on your yearly tax statement, reporting your taxes can be as simple as sending a text message from your cell phone to the Swedish Tax Agency to confirm this.
A general overview of paying taxes in Sweden
More information on declaring your income tax in Sweden
Tax relief for foreign key personnel