SEK 1.5bn in electricity-tax relief misses its intended target

About SEK 1.5 billion a year in Swedish electricity-tax relief goes to companies that are not electricity-intensive or do not compete internationally, according to a new national audit.

The National Audit Office, Riksrevisionen, says that is part of roughly SEK 14 billion in annual relief for industrial manufacturing. The scheme was designed to protect the competitiveness of electricity-intensive firms exposed to international competition.

Some companies outside traditional industry meet those conditions but cannot receive the relief. Auditors are urging the government to redesign the scheme so it reaches its intended recipients.

They also found weak checks by Skatteverket, the tax agency. Companies subjected to tax audits had collectively claimed 20% too much relief. Nearly 30% of applicants sought relief for their entire reported electricity consumption, although it covers only electricity used in industrial manufacturing.

Riksrevisionen recommends more risk-based checks and examination of whether companies should have to measure the electricity they claim relief for.

The reduced tax covers about a third of Sweden’s electricity use. Yet its effects on climate and energy-efficiency targets have received only limited study, the audit says.

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