Denmark's government to cut tax by nearly 7bn kroner: report
Denmark's government is set to announce tax cuts of 6.75 billion in its new tax plan, extending the tax reductions agreed earlier between the three-party coalition by more than a third, the Børsen newspaper has reported.
In their coalition agreement last year, the Social Democrats, Liberal Party and Moderate Party agreed to implement tax cuts of some 5bn kronor, a sum which will now be increased to 6.75 billion.
According to the financial newspaper, the government will use 800 million kroner of the extra 1.75bn in tax reductions to further increase the employment allowance, which exempts a portion of income from taxation for anyone who has job.
According to the newspaper, the government believes that increasing the allowance will boost the labour supply by some 5,150 people by 2030.
READ ALSO:
- Beskæftigelsesfradraget: What is Denmark's employment allowance?
- How will the new Danish government change income tax?
The agreement to cut taxes was criticised by some regional and municipal governments, who argued after it was announced in December last year that it would be better to keep taxes as they are and then use the revenues to better fund healthcare and welfare provision.
According to Børsen, the new tax plan will, as announced last December, reinstitute the so-called "intermediate tax" or mellemskat, under which the top rate of tax is halved to 7.5 percent for incomes between around 550,000 and 750,000.
Finally, it will bring in a millionaire's tax, or 
top-topskat of 20 percent for income over 2.5 million kroner a year.
According to the newspaper, the goverment had been due to present the changes to its tax reform plans last week, but delayed the announcement because of the decision of Liberal Party's leader, Jakob Ellemann-Jensen, to resign and leave politics.
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In their coalition agreement last year, the Social Democrats, Liberal Party and Moderate Party agreed to implement tax cuts of some 5bn kronor, a sum which will now be increased to 6.75 billion.
According to the financial newspaper, the government will use 800 million kroner of the extra 1.75bn in tax reductions to further increase the employment allowance, which exempts a portion of income from taxation for anyone who has job.
According to the newspaper, the government believes that increasing the allowance will boost the labour supply by some 5,150 people by 2030.
READ ALSO:
- Beskæftigelsesfradraget: What is Denmark's employment allowance?
- How will the new Danish government change income tax?
The agreement to cut taxes was criticised by some regional and municipal governments, who argued after it was announced in December last year that it would be better to keep taxes as they are and then use the revenues to better fund healthcare and welfare provision.
According to Børsen, the new tax plan will, as announced last December, reinstitute the so-called "intermediate tax" or mellemskat, under which the top rate of tax is halved to 7.5 percent for incomes between around 550,000 and 750,000.
Finally, it will bring in a millionaire's tax, or top-topskat of 20 percent for income over 2.5 million kroner a year.
According to the newspaper, the goverment had been due to present the changes to its tax reform plans last week, but delayed the announcement because of the decision of Liberal Party's leader, Jakob Ellemann-Jensen, to resign and leave politics.
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