Finnish expert on Swedish gasoline discount: 'A gamble'

Sweden now boasts some of the cheapest gasoline prices in Europe, a result of the current government's tax cuts on fuel. This motorist-friendly policy stands out in the Nordic region and is considered an economic gamble by Hanna Kalenoja, a leading expert on transport at the Finnish Chamber of Commerce.

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The motorist-friendly policy is exceptional in the Nordic region – and an economic risk, says expert Hanna Kalenoja at the Central Chamber of Commerce.

Kalenoja highlighted that the price difference is substantial, with 50 liters of 95-octane gasoline costing over 300 Swedish kronor less in Sweden than in Finland. This disparity stems primarily from the Swedish government's decision to lower the gasoline tax and reduce the mandate for blending renewable fuels to the minimum EU level. "It is unusual. In recent decades, fuel taxes in the Nordic countries have been at roughly the same level," she noted.

The Swedish gasoline tax is now only a fifth of Finland's. While the Swedish tax is 1.57 kronor per liter, Finland's is 7.49 kronor per liter. Kalenoja views the Swedish tax reduction as very generous from a Finnish and European perspective. She questions why Sweden, of all EU countries, opted for the lowest tax, even if temporarily. She also suggests that such measures, implemented during fuel crises, often fail to help those most in need and can discourage the purchase of electric vehicles, as seen by the higher EV registration rates in Finland and Denmark.

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It is unusual. In recent decades, fuel taxes in the Nordic countries have been at roughly the same level.

Kalenoja links the Swedish tax cut to a political strategy aimed at appealing to voters. Finland's government, facing a national debt approaching 90% of its GDP compared to Sweden's just over 35%, cannot afford similar reductions. Furthermore, Sweden's lowered requirement for renewable fuel blending, now at 10% compared to Finland's 19.5%, further reduces pump prices. This difference in blending mandates alone can increase the price per liter in Finland by approximately 1.0–1.5 kronor.

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From a Finnish and European perspective, the Swedish tax cut is very generous.

In Finland, the reduction mandate has been considered the most crucial tool for meeting EU targets to cut traffic emissions by half by 2030 compared to 2005 levels. The Finnish government has proceeded with national measures assuming necessary actions would be taken.

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In Finland, the reduction mandate has been seen as the most important tool for reaching EU requirements to reduce emissions from traffic.