So much more in the household's wallet

Retirees and students can count on around 300 kronor more in their wallet per month. This will be the effect of next year's increase in the price base amount, according to Swedbank's calculations. But the falling inflation means that the increase will be much smaller than the giant boost of recent years.

» Updated: July 17 2024

» Published: July 13 2024

So much more in the household's wallet
Photo: Henrik Montgomery/TT

Pensioners and students can count on around 300 kronor more in their pockets per month. This is the effect of next year's increase in the price base amount, according to Swedbank's calculations.

But the falling inflation means that the increase will be much smaller than the giant leaps of the past few years.

The price base amount is increased by 1,500 kronor to 58,800 kronor in 2025.

In comparison, the price base amount has increased by 4,000-5,000 kronor per year for the past two years. But since consumer price increases – inflation – have slowed down recently, the increase is now smaller.

"It's still a larger increase than the ten years before 2023 and 2024, when the increases were exceptional, since inflation was very high," writes Madelén Falkenhäll, Swedbank's sustainability economist, in an email to TT.

"Higher cost levels"

The price base amount affects various benefits and social insurance. Falkenhäll does not want to talk in terms of winners and losers.

"The higher levels actually compensate for higher cost levels. But in kronor, it's still a welcome addition, for example, for those with parental benefits and sickness benefits, guaranteed pensioners, and students," she writes.

Students with full study grants will receive almost 350 kronor more per month after the turn of the year, according to Swedbank's calculations. The guaranteed pension is increased by around 300 kronor.

Affects taxes

The income ceiling for parental leave and sickness benefits is increased by 32 kronor to 1,250 kronor per day.

Changes in the price base amount also affect taxes through basic deductions and job tax deductions.

A person earning 30,000-40,000 kronor per month can count on around 100 kronor less in taxes each month next year, according to Swedbank.

The effect will be greatest for those with higher incomes. The threshold for state income tax is increased to 643,000 kronor – from 615,300 kronor. For example, someone earning 60,000 kronor per month will get 500 kronor less in taxes.

Increased living costs

Madelén Falkenhäll points out that the effect is expected to be eaten up by increased living costs.

"So, there will be no real change, income will increase somewhat, but so will expenses," she writes.

Swedbank's calculations are based on current regulations and may be affected by future budgets. The government has proposed, among other things, a strengthened job tax deduction ahead of the budget negotiations in the fall.

If this becomes a reality, households will get a boost, according to Falkenhäll.

"Disposable income would then increase more than household expenses, meaning there would be more left in the pocket even after necessary living costs are paid."

The guaranteed pension is increased by around 300 kronor per month.

Student aid is increased by almost 350 kronor per four-week period.

The highest level of parental insurance is increased by 32 kronor per day, which corresponds to almost 1,000 kronor per month.

The highest level of sickness benefits is increased by 32 kronor, which means a highest level of 1,250 kronor per day.

Basic deductions and job tax deductions are increased, resulting in lower taxes on employment income and pensions. How much depends on income.

The threshold for state income tax is increased to 643,000 kronor (almost 53,600 kronor per month, compared to today's almost 51,300 kronor).

The exemption amount, the lowest level, for property tax is increased by 103 kronor, to approximately 4,016 kronor per year.

Source: Swedbank

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By TTThis article has been altered and translated by Sweden Herald

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