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Swedish authorities announced plans to introduce a new tax amid growing threats from Russia

The country's government wants to send money to strengthen defense.

Defense Secretary Peter Hultqvist and Treasury Secretary Magdalena Andersson at a press conference Photo by Tove Ericsson for TT

The Swedish authorities said that they plan to introduce a new tax on banks because of the “growing threat from Russia.” Thus, the government wants to offset the costs of improving defense. This was told at a joint conference by the Minister of Defense of Sweden Peter Hultqvist and Minister of Finance Magdalena Andersson.

As the ministers explained, the profit of the four largest banks in Sweden Handelsbanken, Nordea, Swedbank and SEB in 2018 grew by 277 million euros and amounted to 10 billion euros. The Minister of Finance noted that due to the additional collection in 2022, banks will be able to recover 462 million euros.

How exactly the bank tax mechanism will be arranged, the authorities did not specify. Additional fees will be charged from all banks operating in Sweden, regardless of where their headquarters are located.

The Association of Swedish Banks has criticized a government plan. Representatives of the organization said that they are already paying too high fees for the government to cope with financial crises.

The association recalled that banks in Sweden are on average less profitable than other public companies. Bankers also noted that while there is no legal basis in the country that would allow taxing certain sectors and companies.

Earlier, the Swedish authorities planned to increase defense spending by the same 462 million euros during 2022-2025 – up to 1.5% of GDP. Hultqvist explained the need to increase spending by the growth of external threats. He cited Russia’s aggression against Georgia and the annexation of Crimea as an example.

This is not the first time that the Swedish authorities have declared a possible threat from Russia. Although the country is not a member of NATO, in recent years it has returned a military draft, increased cooperation with neighboring states and strengthened its defense on the island of Gotland in the Baltic Sea, which is located 330 kilometers from Kaliningrad.

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