Aid for the reduction of social charges authorized in Sweden

The European Commission decided, on 11 December, "not to oppose an aid scheme aimed at reducing social charges for SMEs in certain service sectors in Sweden".
She considers that, "Overall, the positive effects of the measure outweigh the potential distortion of competition" (communicated). The proposed measure reduces the cost of labor
work by reducing the social contributions paid by the employer from 32% to 10% of the total salary. It benefits certain sectors: 1) those in which a large number of workers are not
undeclared (underground economy), 2) those that compete with household work or 3) that generate a high demand for workers whose productivity is relatively low
(catering, taxi services, maintenance of passenger cars, motorcycles and small boats, dry cleaning, hairdressing). Only micro-enterprises and small and medium-sized enterprises
can benefit from this measure, which would apply until 2010. The total amount of aid is estimated at 4,1 billion SEK per year (approximately €436 million). According to the Swedish authorities, ula
measure will eventually generate approximately 17 new jobs. The Swedish authorities propose that the effectiveness of the measure be evaluated after two years by an independent expert body.