The proposals include an enhanced earned income tax credit for working seniors, a tax exemption for certain skills support benefits and the indexation of the R&D deduction ceiling, with all measures scheduled to take effect on 1 January 2027.
Sweden’s Ministry of Finance has announced that it is submitting three tax proposals ahead of the autumn budget 2027 on 19 May 2026.
The tax proposals are designed to strengthen labour market participation, facilitate skills development and maintain incentives for business investment in research and development.
The measures form part of a broader effort to support economic growth, improve workforce adaptability and encourage innovation. If approved, the proposals will take effect from 1 January 2027.
R&D deduction ceiling to be indexed
To maintain incentives for corporate investment in research and development, the government has proposed indexing the ceiling amount for the R&D deduction.
The proposal would link the deduction ceiling to the income base amount, ensuring that the value of the incentive is automatically adjusted in line with income growth across the economy. Under the new rules, the total deduction will be capped at 36 income base amounts per calendar month.
According to the proposal, indexation would prevent the value of the incentive from being gradually eroded over time and help preserve its effectiveness in encouraging innovation and business investment.
Enhanced tax credit for working seniors
The government has proposed strengthening the earned income tax credit for seniors to encourage continued participation in the labour market after the target retirement age.
Under the proposal, the tax credit will be increased at a cost of SEK 460 million, reducing tax for working seniors by approximately SEK 1,600 per year. The tax reduction will apply broadly to seniors who remain in employment.
To align the measure with Sweden’s retirement framework, the age threshold for accessing the senior earned income tax credit would also be raised from 66 to 67 years. As a result, individuals who have reached the age of 67 at the beginning of the tax year will qualify for the enhanced credit.
The measure is intended to support higher employment among older workers and ensure that incentives to continue working remain strong after reaching retirement age.
Tax exemption proposed for skills support
A separate proposal seeks to expand opportunities for skills development by exempting certain forms of skills support from benefit taxation.
The exemption will apply to skills support provided by both transition organisations and the Swedish Agency for Administrative and Financial Affairs, including services such as advice and guidance. Purchased training and validation services supplied through transition organisations will also be covered.
The measure is designed to facilitate workforce upskilling and improve labour market transitions by removing tax barriers associated with receiving professional development support.
