Denmark vows to recover billions stolen in tax fraud

Danish Tax Minister Karsten Lauritzen on Thursday announced plans to recover the billions of kroner the nation has lost to tax fraud in recent years.

Denmark vows to recover billions stolen in tax fraud
Tax Minister Karsten Lauritzen. Photo: Ólafur Steinar Gestsson
Lauritzen, displaying clear anger at a press conference, said Denmark would do everything in its power to recover the 12.7 billion kroner ($1.9 billion, €1.7 billion) that were swindled out of state coffers between 2002 and 2015.
The scandal came to light in August 2015, when Skat reported tax fraud to the tune of 6.2 billion kroner ($940 million) – later revised upward to the 12.7 billion kroner figure – to Denmark’s State Prosecutor for Economic Crime (Statsadvokaten for Særlig Økonomisk Kriminalitet). The frauds were related to returns on stock, including dividends, in Danish companies paid to foreign companies.
Lauritzen said on Thursday that progress was being made on recovering the money but he could not hide his frustration. 
“I’m normally a northern Jutlander with a calm disposition but I’m angry and deeply, deeply offended,” he said. “One can only conclude that the greed of certain banks knows no ends.”
The tax minister said that a number of policy initiatives have been launched to strengthen the control of dividend taxes in Denmark and Europe. These include new agreements on the knowledge sharing between countries.
Additionally, as part of the complete overhaul of tax agency Skat, there are now more than 100 extra employees dedicated to the issue. 
“Danish banks have openly acknowledged that they have helped channel money directly out of European treasuries,” he said. 
Lauritzen added that he was “shocked” over the lack of morals within the financial advisory sector. 
“It's an underlying task to instil some morals into this industry. Action must be taken, which is why oversight of tax advisors will now be strengthened,” he said. 
In connection with efforts to recover the swindled 12.7 billion kroner, Lauritzen said that Denmark has sued more than 400 people and companies, frozen 3.3 billion kroner and made settlements with two American pension funds that were involved in the tax fraud.  
More actions are on the way, he added. 
“I want to drive home the fact that we will fight for every single nickel that was taken from the treasury,” he said. 


Danish customers face VAT charges on all non-EU purchases

All goods bought outside the EU will be subject to Value Added Tax in Denmark from July 1st.

Danish customers face VAT charges on all non-EU purchases
Packages in process at a Danish depot. Photo:Mads Claus Rasmussen/Ritzau Scanpix

A decision by the EU to scrap an exemption for low-value items mean that all purchases outside the bloc will now have VAT (moms in Danish) applied.

Under current rules, purchases of under 80 kroner (10 euros) do not qualify for VAT on import to Denmark, but that will no longer apply from July.

This means that anything purchased from, for example, China, the United States or United Kingdom on websites like Amazon and EBay will have VAT added to the price, no matter how small.

The Danish Customs Agency (Toldstyrelsen) said it was working to increase awareness of the incoming change amongst Danish consumers.

A recent YouGov survey, conducted on the agency’s behalf, found that 79 percent of 750 people were unaware of the impending extra VAT charges.

That proportion would correspond to over three million consumers across the entire population.

“It’s a real shame to be left with an extra bill if you think you’ve got a bargain. We want to help consumers avoid this,” said Annette Hove Nielsen, a section leader with the Danish Customs Agency responsible for customs checks on incoming packages at Copenhagen Airport.

Nielsen also directed consumers to the agency’s information page undgå

Foreign residents in Denmark, particularly those from non-EU countries (including the UK since the beginning of 2021) may be more likely to have experienced VAT charges on parcels sent from abroad.

But those charges have previously only been applied in items worth over 80 kroner.

Goods purchased outside of the EU are subject to VAT at 25 percent of the purchase price. Postage and shipping charges are also generally applicable.

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