Sweden's rich and poor tussle over tutor tax breaks

STOCKHOLM Fri Nov 23, 2012 11:07am EST

Sweden's Prime Minister Fredrik Reinfeldt arrives at the EU council headquarters for an European Union leaders summit discussing the European Union's long-term budget in Brussels November 22, 2012. REUTERS/Francois Lenoir

Sweden's Prime Minister Fredrik Reinfeldt arrives at the EU council headquarters for an European Union leaders summit discussing the European Union's long-term budget in Brussels November 22, 2012.

Credit: Reuters/Francois Lenoir

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STOCKHOLM (Reuters) - A Swedish government plan to offer tax breaks to parents who hire tutors for their children has sparked fresh fears about rising class divisions in the traditionally egalitarian nation.

Though the country is home to the Swedish model of high taxes and generous welfare, data from the OECD club of wealthy nations has shown inequalities rising.

The centre-right government of Prime Minister Fredrik Reinfeldt has over six years chipped away at the social welfare system and rolled out wide tax rebates.

The aim to become one of the few countries to offer tax breaks for families who pay tutors to help their children with homework after school has touched off a new debate.

"Politicians must try to keep the country together. This tears us apart," opposition Social Democrat parliamentarian Hans Olsson told Reuters. "The people who are on benefits and need help, aren't going to be able to use this."

Eva-Lis Siren, chairman of the Swedish teachers' union, is also against the proposal.

"We think it more reasonable that resources should be used in the schools instead of for individual selected students outside of school," she told Reuters.

The government sees the move as a way to boost educational attainment as Sweden has seen its position in global education rankings slide over the past decade.

The Organisation for Economic Cooperation and Development (OECD) reported in a 2009 survey that 15-year-old students in Sweden trailed most of their Nordic neighbors in reading and mathematics, performing only just around the OECD average.

Lena Asplund, a parliamentarian for Reinfeldt's Moderate Party, said other tax rebates had led to an increase of some 9,000 full-time workers each year, and that the long-term figure should almost double.

But OECD figures show Reinfeldt's reforms, as well as earlier changes, some under the Social Democrats, after a 1990s crisis, have given Sweden the steepest increase in inequality over 15 years amongst the 34 members of the organization, with disparities rising at four times the pace of the United States.

($1 = 6.6785 Swedish crowns)

(Reporting by Mia Shanley, editing by Patrick Lannin and Paul Casciato)

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