Late Friday the 24th of February, the Swedish government announced that it will not proceed with the proposal on a Financial Activity Tax (“FAT”), on which we have previously commented in TaxNews no 10, 2016. The governing political parties together with the Left Party have instead agreed to further analyze the possibility to introduce another tax, more specifically aimed towards banks.

The main reason given for withdrawing the proposed FAT is the significant negative feedback received and the risk for an adverse – and not intended – impact on e.g. pensions and Fin Tech companies.

At the same time, the government announced that a proposal on increasing the resolution fee, which the banks contribute to the Government Resolution Fund, will be referred for consideration. Increasing the Resolution fee is said to strengthen public finances.
 

KPMG Comments

Based on the significant negative feedback it was not unexpected that the government chose not to move forward with the proposal in its current form. If a different tax aimed specifically at banks is compatible with EU law on state aid remains to be seen, as well as who will be subject to such tax.

You are very welcome to contact us if you have any questions on what this could mean for your business.

Link to the article in Swedish