Tax-reform row threatens Sweden's ruling coalition

Sweden's frail coalition government faced collapse after Conservative Party ministers staged a walkout over a dispute on income-tax reform. Prime Minister Thorbjoern Faelldin postponed a decision on dissolving his government and said three solutions were possible -- the government could resign , elections could be called, or he could continue with tacit Conservative support.

The three-party coalition of Conservatives, Liberals, and Centrists holds a one-seat majority over the opposition Social Democrats and Communists in Parliament.

Meanwhile, the country faced the possibility of a crippling strike by a trade union representing about 17,000 clerical workers in key sectors of the economy. The issue is co mpensation for wage drift -- the difference between actual earnings and basic wages -- in the private sector.