He earns more than most, but still often pays less tax than the average taxpayer. Now, business taxes can be reduced further – despite the system already being abused.
Should an attorney or consultant who runs their own business pay over 60 percent or around 35 percent in tax on their work income? That's what it's about when the complex so-called 3:12 rules are being discussed again.
On Monday, an investigation will submit proposals for simplifications, with the aim of making it easier to be an entrepreneur, and that doesn't matter if the state's tax revenue is lower, according to the directives.
But the many entrepreneurs it's about are already tax-advantaged compared to other groups. This has been shown by several studies, including an ESO report from 2014.
Even the government has noted that the low taxes for dividends to one-man company owners have led to increased economic disparities in society.
In earlier governments, primarily conservative, the rules were tweaked to favor entrepreneurs. This was justified by saying that the company owners would create more jobs. But that didn't happen, as previous research shows. Instead, more companies were created that were often used for tax planning.
The rules are needed to some extent, but they miss the mark, according to her.
Over the years, enormous amounts have been built up in the system. There are 1.5 trillion kronor in saved profit margins (2022 figures), based on half a million individuals, according to Tax Agency figures. This is money that entrepreneurs can later withdraw for capital taxation, a tax that is roughly half as large as if they had been taxed as income from a service.
The underlying problem is that the difference is so large between capital taxation and tax on income from a service, according to Hansson.
But there are also benefits to the rules. For example, perhaps the relay runners wouldn't have wanted to take on side jobs in Norrland if they had been harder taxed, according to Hansson.
In Sweden, we have two different tax rates, both for income from a service and for income from capital. This opens up the possibility for those who have the means, capital owners, to have their income taxed as capital instead of service/salary. Salary income is taxed progressively, that is, higher the larger the income, up to 60 percent. Capital is taxed at around 30 percent.
The so-called 3:12 rules originally came into being to prevent owners of one-man companies from shifting too much of their salary income (with higher tax) to capital income (with lower tax). From 2006 and onwards, these rules have been changed several times, making it more tax-advantageous to withdraw money from the company as capital dividends, with 3:12 rules at 20 percent tax (including company tax, the actual tax rate is around 35 percent).
The 3:12 rules, which are complex in nature, specify how much of the work income can be withdrawn to the lower tax rate.
