Swedish Government’s VAT Cut Leads to Lower Food Prices Ahead of Election
Impact and Details of Sweden's VAT Reduction on Food
Government's Announcement and Election Context
OSLO, Sept 1 (Reuters) - Sweden's government said on Tuesday that its reduction of value-added tax (VAT) on food has resulted in lower retail prices, part of an election-year effort to address rising cost of living for consumers.
The right-wing government, which is trailing the centre-left opposition in opinion polls ahead of an election for parliament on September 13, last year announced it would temporarily cut VAT to 6% from 12%, lasting from April 2026 to December 2027.
Implementation and Effectiveness of VAT Reduction
Report Findings
The reduction in VAT had been fully implemented by grocery stores, according to a report on Tuesday by the Swedish Consumer Agency and the National Institute of Economic Research, which cited statistics agency data and other analysis.
Government Statements
"This is good for households, and very important for families with children," Minister for Public Administration Erik Slottner told a press conference.
Future of the VAT Policy
Uncertainty Beyond 2027
But the government has not decided what will happen in 2028 when the current measure expires.
"We'll have to see what we do in 2028," Finance Minister Elisabeth Svantesson told the press conference.
Projected Savings for Households
Estimated Benefits
Deputy Prime Minister Ebba Busch in 2025 said the average family would save 6,500 Swedish crowns ($678.05) a year, while a pensioner couple would save around 4,400 crowns, from the VAT reduction.
Currency Exchange Rate
($1 = 9.5863 Swedish crowns)
Reporting Credits
(Reporting by Terje Solsvik, editing by Essi Lehto)
