Swedish Tax Act 2016: 1067

Swedish Act 2016: 1067 is a new law that provides for a tax on certain chemicals in specified electronic products.

The law became effective on April 1, 2017 and tax liability became applicable on July 1, 2017. The annex at the end of the Act lists the bromine, chlorine and phosphorus containing compounds that are presumed to have been either physically added or chemically reacted into products unless demonstrated otherwise.  The tax rate is determined solely by the type of electronic good specified in the regulation.  One group of goods is taxed at 8 SEK rate per kilogram and a second group is taxed at 120 SEK per kilogram.  Both groups are capped at 320 SEK per taxable good.  The Act and associated tax liability do not apply to goods that are sold directly to Swedish customers by businesses that are located and deliver their products from outside of Sweden.

The Act allows for a 50% reduction of the tax if the amount of additive bromine and chlorine are each kept below 1000 ppm at the homogeneous level.  Additionally the Act allows a 90% reduction in the tax if the amounts of additive bromine, chlorine AND phosphorus are each kept below 1000 ppm at the homogeneous level AND any reactive bromine and chlorine is limited to less than 1000 ppm.  Our review of the Act concluded there are no identification, reporting or disclosure requirements under the law regarding the specific substances used in the electronic goods.

Customers throughout the supply chain must make their own determinations on this topic and should seek out professional advice as appropriate. Isola cannot provide tax advice on Swedish law.  That being said, Isola completed a comprehensive review and documented our own interpretations and conclusions in a reference letter for our customers that maybe be reviewed here: Click Here.