Denmark’s government announces new tax plan

The Local Denmark
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Denmark’s government announces new tax plan
Ministers (L-R) Brian Mikkelsen, Simon Emil Ammitzbøll, Kristian Jensen and Karsten Lauritzen present the plan on Tuesday. Photo: Mads Claus Rasmussen/Scanpix

Lower tax on income, cars and pensions are all part of a 23 billion kroner plan unveiled by Denmark’s government on Tuesday.


The coalition government unveiled its much-anticipated tax reform proposal Tuesday morning.

The reforms will mean 21,000 Danes in full time employment will now pay lower amounts of tax, according to DR’s assessment of the plan.

Overall, the state will collect 23 billion kroner (3.1 billion euros) less from taxation should the plan be implemented.

A limit to tax reductions known as beskæftigelsefradraget will be scrapped by the new plan, benefitting anyone with an annual income of over 340,000 kroner (45,000 euros).

A new deduction known as a jobfradrag will also reduce tax by an expected 2.7 percent for people with incomes of over 569,400 kroner, and by 7.7 percent for those with incomes between 174,000 and 232,400 kroner (23,400 - 31,200 euros), according to DR’s analysis.

Those on lower incomes will also be given a tax deduction worth 4,500 kroner (604 euros), while vulnerable citizens will be able to earn a limited amount tax-free.

“This plan enables us to tackle a number of challenges. We are increasing the reward for working, making it more attractive to work longer hours, and ensuring that it pays better to save up for a pension,” Finance Minister Kristian Jensen said in the government’s publication of the plan, which also includes provisions to reduce fees attached to car ownership.

READ ALSO: Denmark government drops plan to cut tax for rich



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