RUT-sector slow down blamed on gov's promises to reduce tax breaks

After years of growth and benefiting from the large RUT tax break, in 2015 the industry for cleaning and other household services has grown less than a percent, a slowdown some are attributing to the government's promises to reduce the write off.

"We have many people from other countries who work for us," said Pamela Adolfsson, who runs a cleaning company in a wealthy suburb west of Stockholm. "they speak poor Swedish but are good at cleaning. I don't know what they're going to do if they don't clean. Probably they'll start to work off the books again."

Swedish Radio reports that so-called RUT-sector jobs increased every year since the tax break was put into place eight years ago. During 2011 to 2014 the number of companies in the industry grew an average of nine percent each year, according to statistics from the Swedish Tax Agency. But in the first six months of 2015 the increase was only half a percent.

In the fall budget, which will offcially be presented on Monday, the government will propose making the RUT tax break available for fewer services and cutting the roof for the deduction in half, down to SEK 25,000 per person per year.

Carola Lemne from the Confederation of Swedish Enterprise said it was the wrong course of action as Sweden confronts a large integration challenge.

"Many jobs are for people without a lot of education, both Swedes but many of the newly arrived. We're talking about 20,000 jobs in the sector today, and there's the potential for 16,000 in the coming years. Turning them down when we're trying to reach the lowest unemployment levels in Europe is shooting yourself in the foot," said Lemne.

But Karl-Petter Thorwaldsson, President of the Swedish Trade Union Confederation, warned of low wages.

"This is a fight we have had against employers in Sweden for 100 years. They always want low wages. A few years ago there were young people who had low wages to take hold. Now is the people who come here fleeing war and oppression. It gets a bit too much that workers always get low wages when we have a new challenge on the Swedish labor market," he said.