The property tax, which will be eliminated as of January 2008, will be replaced by a municipal tax that will have a ceiling of 6,000 kronor ($912 dollars) per household.
Property tax had yielded the state an average of 16.3 billion kronor each year.
The abolition of the wealth tax, in place since 1947, was meanwhile aimed at attracting risk capital investments to help companies grow and increase employment.
Job creation has been the centre-right government's primary objective since coming to power in October 2006.
Announcing the government's plans in March, Swedish Prime Minister Fredrik Reinfeldt pointed out that only five of the 30 member states of the Organisation for Economic Cooperation and Development (OECD) – France, Norway, Spain, Sweden, Switzerland – still had wealth tax.
In 2006, the state received some 5.9 billion kronor in revenues from the tax. Figures showed that 284,279 people paid the tax, representing about 2.5 percent of the population.
The tax was equivalent to 1.5 percent of wealth exceeding 1.5 million kronor for singles and 3.0 million kronor for couples.
However, some of the country's richest entrepreneurs have been exempt from wealth tax since 1997, including the family that controls Swedish fashion retailer H&M.
They had threatened to leave the country and take their companies with them if forced to pay millions of dollars in wealth tax.
The tax is to be compensated by a decrease in the tax break granted to private pension savings.