Competitiveness: Now Sweden to cut corporate tax rates
From The Local, a website that compiles English-language news from other countries, "Sweden unveils plan to slash corporate tax rates ":
Sweden aims to cut corporate tax rates by 15 percent in 2013 in a move estimated to cost state coffers about 16 billion kronor ($2.4 billion).
"This is the most harmful tax of all," Prime Minister Fredrik Reinfeldt told reporters during a Thursday press conference.
In a proposal, the government unveiled plans to lower corporate tax rates to 22 percent from the current level of 26.3 percent.
"We want to provide a stimulus for both small and large businesses," enterprise minister Annie Lööf told reporters, according the Expressen newspaper.
Sweden also has a territorial tax system.
UPDATE (Sept. 18, 4:30 p.m.): From the European edition of The Wall Street Journal, an editorial, "Sweden 22-U.S. 35 ":
The headline above is not an athletic game score, and in this contest you want to be on the lower end. We're talking about the corporate tax rate, which Sweden Prime Minister Fredrik Reinfeldt has announced that he intends to cut to 22% from 26.3% as part of his next budget.
The rate cut will be partially offset by closing some loopholes, but it will leave famously high-tax Sweden with one of the lowest corporate tax rates in Western Europe. With a top marginal personal income-tax rate of 57% and government spending equal to 56% of GDP, Sweden is no free-market paradise. But over the past two decades, Sweden has cut its public debt to 33% of GDP from a high of nearly 80% in the 1990s. It has also kept the budget at or near balance.
In announcing the cut last week, Mr. Reinfeldt called the corporate income tax "probably the most harmful tax of all" because it hits job creation and business investment. Corporate income taxes almost invariably lead to double taxation, as the profits taxed at the corporate level tend to be taxed again when they are distributed as dividends or realized as capital gains on business ownership.