Global Daily Tax News, Sweden Aims To Enhance Tonnage Tax Regime's Appeal, (Nov 25, 2025)

The Swedish Government has proposed improvements to the nation's tonnage tax regime.

Under the tonnage tax regime, shipping companies can elect to pay tax based on the net tonnage of their fleet and the number of days the vessels are used, rather than based on profits. The scheme aims to encourage Swedish shipowners to repatriate ships sailing under flags of convenience, and to maintain or develop maritime activities in Sweden.

The Government said the draft legislation proposes improvements to the nation's regime, with the aim of strengthening Sweden's competitiveness in the shipping industry. It also proposes certain clarifications and adjustments to the regulatory framework to better align it with the European Commission's guidelines on state aid for maritime transport and the Commission's decision-making practice on other member states' tonnage taxation systems that has been established since Sweden introduced the current provisions.

The proposals include, among other things, that the Swedish tonnage taxation system be expanded to more activities, including offshore vessels and cable-laying vessels (so-called "special shipping"). It is also proposed that the possibilities of renting out qualified vessels without crew within the framework of tonnage taxed activities be expanded.

The draft legislation would also alter the conditions for a vessel to be qualified. Among other things, the requirement for international trade is to be removed and replaced with a requirement that the vessel be used in traffic that is exposed to international competition in the shipping market.

The draft legislation would also establish a lower requirement for gross tonnage for vessels engaged in special shipping. Further, it is proposed that more generous conditions be introduced for companies to use the so-called excess depreciation fund.

The legislative amendments would be introduced effective for tax years beginning after December 31, 2026.

The Swedish Shipowners Association welcomed plans to expand the regime to special shipping, among other changes, but said further improvements are necessary to make Sweden's regime as competitive as others offered in other EU countries.

The organization said: "It is particularly regrettable that the Government does not enable Swedish shipping companies to charter their own vessels to subsidiaries operating in the European market, which makes the Swedish system significantly weaker than several other European systems. This limitation means that many shipping companies choose to remain outside the Swedish tonnage tax system and fly the flag in countries with more competitive cost structures."

The Association's business policy expert, Camilla Aberg Linder, said: "We look forward to continued improvement work where the industry's needs that have been raised are addressed. We need to ensure that the rules are as simple as possible, that Sweden introduces all parts of the tonnage tax that are used elsewhere, and that shipping support is restored and can be used by all types of shipping, including special shipping."