The Moderates lower taxes most for high-income earners

At the Moderates party meeting in Västerås, familiar phrases from Fredrik Reinfeldt's reign echo, when the job tax deduction was a key reform. Now another job tax deduction is proposed and it is liked by many moderates at the meeting.

"We are the taxpayers' gatekeepers," says Deshira Flankör, M-representative from Stockholm County.

"It should pay off to work", is heard among the chair rows. Most notable is Benjamin Doussa, Chairman of the Moderate Youth League:

- We should not be ashamed. We must stand up because we are a tax cut party. There is no other party in Swedish politics that wants to reduce taxes and contributions as much as we want.

The Moderates' tax proposal means higher tax cuts for high-income earners by gradually reducing the state income tax and the party wants to remove the tax on taxes, a tax that Fredrik Reinfeldt refused to abolish during his time as prime minister.

Madelén Falkenhäll, senior analyst at Swedbank, has for Agenda calculated on the Moderates' tax proposal. The proposals mean that party leader Ulf Kristersson, who earns SEK 176,000 a month, may retain SEK 10,500 more per month. The moderate members of parliament at the AGM who earn close to 70,000 a month may retain SEK 2,020 more per month.

The turn-on can be compared to part-time worker Karin Granlund Lundin who worked as a waitress at the M-meeting. She earns around SEK 13,000 a month. With the Moderates' proposal, she would be able to keep SEK 300 more a month. The outcome will be about the same for Maria Afram, who was the guardian at the meeting. She works for staffing companies and a good month she comes up to just over SEK 30,000 a month. She would have to keep SEK 290 more a month with the M-proposal.

But are job tax deductions, as many moderates believe, good for employment?

Eva Mörk, professor of economics, is not as convinced. Already in 2012, she stated that it is not scientifically possible to prove that job tax deductions really affect employment. She wonders why the Moderates want another job tax deduction.

- They are so convinced that this is good. They don't care to find out if it's really good or not.

Eva Mörk's skepticism is supported by Danish professor Henrik Kleven at Princeton University, who has presented new findings that even more distort the image that job tax deductions lead to increased employment.

According to Eva Mörks and Henrik Kleven's conclusions, the positive effects on employment that were noted after the introduction of the job tax deduction could equally well be due to the austerity measures that were simultaneously implemented in the welfare systems, for example, reduced sickness benefit and unemployment benefit.