The employer’s contribution must be reduced, Svantesson


Yet public knowledge of this great treasure is limited. When Svenskt Näringsliv investigated the matter a few years ago, a third did not know at all how much employer’s contribution is paid in on one hundred Swedish rupiah in salary. Two-thirds of the respondents considered that the employer’s contribution is a burden on the employer (although the only reasonable view is that it is taken from the salary area). There is a likely explanation for the lack of knowledge, and that is that the amount paid to the employer’s contribution does not have to be stated on the salary statement. Many employers choose to post information about this, but far from all. It should be legislated. When members of the Riksdag write motions with this requirement, it is usually rejected with reference to not increasing the administrative burden on companies. But the real reason is, of course, that governing politicians who do not want to cut taxes depend on people not having the whole picture. If it became clear that more than half goes to taxes for most wage earners, it would be impossible to resist demands for tax cuts. The fee is 31.42 percent (in addition to that are the fees that most employers pay according to collective agreements or other agreements with the staff.) The last reduction was in 2009, by 1 percentage point. At the turn of the millennium, the fee was 32.92 percent. The percentage that employers must pay in has thus fallen somewhat. The strange thing is, however, that the part of the fee that is a pure tax – “general salary fee” – has increased continuously during that time. In 2000, it was 3.09 percent, now it is 11.62 percent. The reason for this is that the parts intended for special purposes, such as health insurance, have fallen due to reduced payments. The general wage contribution fills up so that the total employer contribution should not be lower than precisely 31.42 percent. Just over a third of the employer contribution is thus pure tax. But it doesn’t stop there. Health insurance has a ceiling. However, the part of the employer’s contribution known as the health insurance contribution (currently 3.55 percentage points) is paid on the full amount of wages regardless of what the employee earns. The pension authority therefore assesses that almost half of the health insurance contribution is a pure tax. To this must be added that the parts that should go to health insurance and parental insurance do not go to any special fund. The money goes straight into the state treasury and the payments to those on sick leave and parental leave are a completely different expenditure item in the state budget. However, the old-age pension contribution of 10.21 percentage points does not go into the state treasury, but to the pension system. But this only applies up to the limit for earning pension rights, SEK 599,250 a year. Everything above that goes into the state treasury as a tax. All these circumstances are expressions of state hypocrisy. It’s called a fee, but it’s a tax. They say it should go to specific purposes, but it doesn’t. Changing this requires considerable political action. However, what can be done fairly immediately is to lower the total level of the employer’s contribution. Admittedly, there are some restrictions in fiscal policy. One of these is the strict budget rules that limit freedom of action. Another restriction, currently very weighty, is that fiscal policy must not sabotage the Riksbank’s inflation control. Expansive measures, i.e. the state “sending out” money into society, must be avoided in this high-inflation situation. But it is different with reduced employer contributions, at least if you are to trust the Economic Institute’s assessment. KI assesses that a reduction in employer contributions lowers companies’ costs, and then prices are lowered, which thus reduces inflation. KI calls it “a potentially attractive fiscal policy instrument in economic situations like the one the Swedish economy is in at the moment”. The government should listen to this. If not this fall, then later. Reducing the employer contribution should be a possibility during this term.

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