Sunday, June 9, 2013

TV fee

It’s no secret that Sweden has some of the highest tax rates in the world. We put a lot in, but I complain about it far less than when I first moved here because over these past few years I’ve discovered that we get a lot out in different ways, too.

I read about a jaw-dropping study one of Sweden’s big banks conducted last fall that claimed the average Swede pays up to 70 percent of our monthly salary in taxes. Granted, that total includes traditional paycheck withholding, steep value added taxes on goods and services and hefty payroll taxes paid by employers that employees never even see — but it’s still a pretty insane figure to wrap one’s mind around.

Among the ways we’re slowly but surely parted with our hard-earned kronor is a TV and radio tax assessed by the Swedish government, independently of any monthly fee charged by a cable or satellite provider for channel packages.

It used to be called a “TV license” but nowadays it’s referred to as a “TV fee.” I consider it a tax. Radiotjänst (“Radio Service”) is tasked with collecting 2076 SEK ($315 USD) annually per household, either in one lump sum or four quarterly installments, on behalf of Sweden’s three public broadcasters — Sveriges Television (SVT), Sveriges Radio and Sveriges Utbildningsradio (educational broadcasting). In return we receive several commercial-free TV channels, many radio channels and Internet TV and radio.

Only two of the TV channels are really relevant as far as I’m concerned. SVT1 is the first channel in Swedish TV history. It features a wide range of news, entertainment, drama and sports programming, while SVT2 has a more tailored focus with an emphasis on cultural performances, documentaries, current affairs and nature series.

SVT broadcasts everything from sporting events like Vasaloppet (the world’s oldest, longest and biggest cross-country ski — I like to pretend my yearly 2000 SEK goes into the gas tank of the helicopter that gets such awesome aerial shots of the skiers) to random concerts — one night SVT aired a Lady Gaga performance from Madison Square Garden. There’s also a quiz show similar to Jeopardy! that I like called Vem vet mest? (“Who knows the most?”) that helps me with my basic Swedish, and of course the country’s most popular program, Melodifestivalen, the six-week preselection for the Eurovision Song Contest. As many as half of Sweden’s 9 million residents tune in to SVT for the Melodifestivalen final.

Both main SVT channels broadcast a great deal of foreign programming from the U.S. and UK in English with subtitles. SVT also shows some Danish, Norwegian and Finnish programming. Some of the programming is boring and uninteresting, but viewership is very high — it remains the biggest TV network in Sweden with an audience share upwards of 35 percent.

Under Swedish law, everyone who has had a television receiver in their residence has been required for many years to pay the license fee, regardless of whether or not they watched SVT programming and even if a TV was only used to view DVDs or play video games. Somewhat ridiculously, if a household even had a TV with no way to physically receive a signal, they were still obligated to pay the tax.

Radiotjänst brings in upwards of 7 billion SEK annually — well over $1 billion USD — to part-finance the public broadcasters, but it claims only nine of 10 households that should pay the tax do. Several Swedes I know object to the principle of paying it, and Radiotjänst claims that is shorting the broadcasters close to 1 billion SEK every year.

Radiotjänst constantly checks its customer database against address registers and diligently enforces collection of the tax, by phone, mail and in-person. It has both licensed and freelance foot soldiers (I guess their actual title would be something like “inspectors”) located around the country who go door-to-door visiting households that don’t pay the tax to find out why and to try to change that.

These days, SVT’s focus has naturally shifted to mobile internet devices as it tries to bring TV tax payment closer to 100 percent. I think SVT feels some pressure from mobile streaming services like Netflix, which launched here only recently and has a very poor content selection compared to the U.S. service, but is a much cheaper monthly subscription than Sweden’s (albeit compulsory) TV tax.

SVT now offers its entire content lineup “for free” online, requiring Swedes who only watch digitally streamed programming on iPads or other tablets to pay even if they don’t have a TV. I don’t think it legally covers all smartphones yet, but I’m sure it’s only a matter of time. SVT does have a pretty decent app for iOS and I’ve watched content through it on my iPhone on a few occasions.

I respect these changes and the efforts — and certainly don’t approve of anyone stiffing any business out of any amount of money — but how many of the 10 percent who should be paying the tax but aren’t will start now? I find it hard to believe anyone is getting rid of their TV and only watching content on mobile devices just to legally save 2000 SEK per year. If they’re cheating the tax now, they’ll keep cheating it. I can’t see the new licensing system that targets connected devices making much of a difference in the bottom line, but maybe I’m wrong.  

When I first moved here, I was a bit shocked to learn about the cumpolsory TV tax. Even though I don’t watch much TV and often am not interested in SVT’s programming, I pay the TV tax and have paid it since the day I moved into my first apartment in Sweden. I’m an honest person (I also don’t want to jeopardize my residency or risk being hit with a huge fine) but beyond all that, I believe these license fees in countries like Sweden and the UK (SVT shares many similarities with the BBC system) support an important public service — broadcasting that is, at least for the most part, objective, impartial, commercial-free and of a fairly high quality.