Swedish government rate cut boost for tax efficient savings

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The latest cut to the benchmark Swedish government borrowing rate should serve to create better returns for investors using the investment savings account (Investeringssparkonto) wrapper, according to the Swedish Investment Fund Association.

The rate, which is a reference rate used for tax purposes, was cut to 0.9%. This means that the effective flat rate tax rate applied to gains made in the wrapper will be just 0.27% in 2015, according to the Association.

It added that coupled with removal of deductions relating to private retirement savings, then the benefits of saving through the wrapper next year will be even greater.

An estimated SEK35bn (€3.8bn) has been saved into the wrapper by individuals through the first three quarters of 2014.

Jonathan Boyd
Editorial Director of Open Door Media Publishing Ltd, and Editor of InvestmentEurope. Jonathan has over two decades of media experience in Japan, Australia, Canada and the UK. Over the past 17 years he has been based in London writing about funds and investments. From editing the newsletter of the Swedish Chamber of Commerce in Japan in the 1990s he now focuses on Nordic markets for InvestmentEurope. Jonathan was awarded Editor of the Year at the Professional Publishers Association (PPA) Independent Publisher Awards 2017. Shortlisted for the same in 2016, he was also shortlisted in 2017 and 2015 for the broader PPA Awards category Editor of the Year (Business Media).

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