Östling steps down

“What the hell do I get for my money, not much,” were the words uttered by Leif Östling, chair of the Confederation of Swedish Enterprise, when asked by SVT about his tax arrangements in Malta and Luxembourg, revealed during the Paradise Papers leak in November.

He announced yesterday that he would leave his post as chair although would not answer any follow-up questions. The official picture is that he has successfully managed to launch a new power and decision-making structure within the Confederation. However Dagens Industri (DI) reports that a number of representatives from the board made it clear that confidence in him had been lost following his comment.

Another source tells DI that the relationship between CEO Carola Lemne and Leif Östling did not work. “From day one he tried to manoeuvre her out of the way, but failed,” says the source. The struggle between the chair and CEO also reflects a deeper conflict between industrial and service companies. The Association of Swedish Engineering Industries and the Swedish Association of Industrial Employers backed Östling after the revelations while criticism came from Almega – the Employers’ Organisation for the Swedish Service Sector and the Association of Private Care Providers.

There is a general understanding that the Confederation is in trouble and has been described as outdated and slow to change. The change of chair could also lead to a change of CEO, writes DI.

Tax hike criticised

On Monday the government announced a new package of measures designed to boost Swedish exports and the innovation climate. SKr 226 million will be earmarked towards the initiative this year and SKr 315 million annually thereafter up to the end of the government’s term of office.

However, Dan Olofsson, owner of Danir AB, does not give much for the drive, pointing out that the government intends to raise taxes by SKr 20 billion in 2016, but will invest just 1 per cent of the revenue generated on export promotion. He also slams the argument put forward by the government that higher taxes on businesses and on labour will create more jobs.

“They transfer billions from enterprise to the state and believe the state is some kind of expert in creating jobs and in economic dynamics, which I do not believe. Globally, competition is stiff and we should look after our businesses. Heaping costs onto companies is fundamentally wrong,” he says.

The Confederation of Swedish Enterprise is also critical, saying the funds allocated for the initiative, which may or may not have an impact, are nothing compared to the taxes that will shortly be levied on companies.