Denmark's new budget will be passed in parliament before Christmas without agreements on tax and immigration.
Coalition partner Liberal Alliance (LA) had suggested it would not vote through the budget, which was agreed by Denmark's three government parties and parliamentary ally the Danish People's Party (DF) earlier this month, if the tax cuts, a core part of the LA party programme, we not passed by Christmas.
But the party has now rolled back on those threats with final agreements to secure tax cuts and new asylum rules put on hold until the new year.
The tax deal had originally been a part of the budget package but was later separated from it.
The new announcement appears to represent a defeat for LA, which had threatened not to pass the budget after tax reforms were cut from that deal at the behest of DF.
“We compromised during the course [of agreeing to vote for the budget], not once, not twice, but many times,” LA leader Anders Samuelsen said.
“We have fought for tax reforms in the Liberal Alliance party for years. The possibility of being close to an agreement in the near future is more important to me than taunts, insults and ridicule. So I am prepared to make a new attempt,” Samuelsen continued.
Samuelsen also hinted that he was prepared to withdraw from the coalition – thereby causing the collapse of the government – should the tax cuts not eventually become reality.
“A government should not remain in place at all costs. On the other hand, the line in the sand should not be drawn before all the options have been used up,” he said.
The LA leader, who is also the foreign minister, added that tax cuts remained on the table, and that his party was therefore prepared to vote for the budget.
“Nobody can say that our pride or lack of patience prevented a tax deal. I have agreed that, immediately after parliament's Christmas recess, an ambitious tax deal will be negotiated,” he said.
“On this basis, I have decided that LA will vote for the budget,” he confirmed.