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This is how private carsharing can take off in Sweden

A car will remain parked for 95% of the time. Carsharing is one method of utilising resources more efficiently. However, this development is being held back by outdated regulation.

We are facing a paradigm shift in how we travel. New innovations and changing behaviour will change our views on mobility. Although sharing their private vehicle is now a reality for many people, there are obstacles preventing private carsharing from seriously taking off in Sweden. RISE is currently participating in an investigation into how innovative regulation might accelerate this development.

“After the debate on the sharing economy – largely focusing on Uber and Airbnb – there is a need to demonstrate that carsharing need not be in any way shady. For example, if it were made easier to declare taxable income from carsharing, this in itself would send a signal that there are no shenanigans involved,” says Maria Schnurr, senior researcher in the Sustainable Business Group at RISE Viktoria.

Carsharing more popular in Norway and Denmark

Hundreds of Swedes currently use some service for private carsharing. On any given day, GoMore and Snappcar will have around 1,000 advertisements for private car rental in Sweden.

“However, this is less than in Norway or Denmark, where private carsharing is more widespread and accepted,” says Maria Schnurr.

One reason for this is that it is cheaper to own a car in Sweden than in neighbouring countries. This may be why people are more interested in finding alternative transport solutions in Norway and Denmark.

“Norway also has a tax allowance of up to NOK 10,000 for private carsharing,” explains Maria Schnurr.

Self-declaration a deterrent

Those in Sweden wishing to share their cars are currently required to declare their income to the Swedish Tax Agency. Any money they earn is considered unearned income and is taxed at 30%.

“As things stand at the moment, it may feel that there is not so much money left for those who do share their cars. If you go through one of the existing online services, you will first pay an agent’s fee and insurance and then, the tax bill.”

Even the process of self-declaration itself may be a deterrent.

“How might a solution look in which the system supports automatic reporting of income to the Swedish Tax Agency? In Sweden, many of us are used to declaration forms that are so easy to complete and check that self-reporting becomes a considerable obstacle,” says Maria Schnurr.

In addition to regulatory issues, there are also purely technical pieces of the puzzle missing. For example, there is no established solution for handing over vehicles. Currently it is normally necessary to hand over the keys in person – meaning that lender and borrower must agree on a time and place to meet. However, here there are a number of promising solutions under development by companies and innovators.

Volvo and Hertz in collaboration

Volvo Cars and car-rental firm Hertz are currently collaborating on a pilot project intended to benefit air passengers. Instead of paying for long-term parking at the airport, you can leave your Volvo with Hertz, who will take care of your car and remunerate you if it is rented out during your absence.

“Hertz has a large requirement for vehicles during the summer months due to the large numbers of tourists, while at the same time, many cars stand idle in airport car parks. So, from an environmental and resource-efficiency perspective, this is a very smart solution,” says Maria Schnurr.

Regulatory innovation

A sustainable transport system requires regulatory innovation. However, even if everyone agrees that a sustainable transport system will require new regulation and a system shift, existing legislative processes are far to slow to achieve this. RISE is in a position to support and shoulder the responsibility for driving regulatory innovation and has therefore developed a design-thinking methodology to identify agile and innovative solutions.

Published: 2018-09-24