Alliance (Sweden) - The Alliance in Government

The Alliance in Government

See also: Cabinet of Fredrik Reinfeldt and Government of Sweden

Minister for Finance Anders Borg presented the government's first budget on 16 October 2006. The budget contains many of the proposals that were prominent in the Alliance's election campaign: both the job deduction in the income tax, which will also be larger for old people to encourage them to remain in the labour market, and the "fresh start jobs" with reduced payroll tax for companies employing people who have been unemployed for more than a year will come into effect from 1 January 2007. Tax reductions for companies hiring young people and for domestic services are to come into effect on 1 July. The tax reductions announced in the budget total 42 billion Swedish kronor, of which the income tax deduction is 38.7 billion. Other changes include the ending of employers' co-financing of sickness benefit after the second week and reduction of unemployment benefit. Unemployment benefit will remain 80% of previous pay for 200 days then drop to 70%. Benefit will be payable for a maximum of 300 days, or 450 if the recipient has children.