Sweden Boosts Economy with Record Budget Ahead of Election
Sweden aims to invigorate its sluggish economy with an 80 billion crown injection in the 2026 budget, targeting tax cuts, defence, and public services. The right-wing coalition seeks to reassure voters ahead of next year's election, leveraging strong state finances despite broader EU economic challenges.
Sweden's government has announced a substantial economic stimulus with its 2026 budget, unveiling an investment of approximately 80 billion crowns ($8.50 billion). The initiative is part of the right-wing coalition's strategy to accelerate growth and strengthen voter confidence ahead of the upcoming general election in September.
The budget, described as the most expansive since the COVID-19 pandemic, includes tax cuts for workers, pensioners, and businesses, as well as reduced VAT on food. Enhanced funding is allocated for defence, schools, healthcare, and civil defence, alongside increased housing allowances for low-income families.
While other EU nations grapple with high debt and spending cuts, Sweden's robust fiscal health permits such largesse. The nation's government debt stands at about 32% of GDP, allowing room for significant fiscal measures without jeopardizing economic stability. Even with ambitious plans for nuclear energy and defence spending, debt is projected to remain well below European averages.
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