Tariffs were established in the 19th century to allow for the development of Swedish industry, but the rates have traditionally been among the lowest in the world. Sweden subscribes to the OECD trade liberalization program and imports, with few exceptions, are not subject to controls. As a member of EFTA, Sweden abolished customs duties against other EFTA countries by the end of 1966. In 1991, Sweden formally began the process of joining the European and officially became a member on 1 January 1995. Some 90% of imports from developing countries are duty-free.
In general, the importation of raw materials is duty-free; import duties are based on weight rather than value. Import restrictions apply mainly to protected agricultural products, automobiles, and trade with Eastern Europe and the Far East. Sweden applies common external European Union tariffs to imports from the United States at rates ranging from 2% to 14% for industrial products. Other import taxes include a 25% value-added tax (VAT). A lower 12% VAT applies for food and select products.
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