News in Digest: Always sunny … in the rich man’s world – The Post

News in Digest: Always sunny … in the rich man’s world

Car owners and top earners tend to benefit, but not the common man on the street

A messy desk is a perfect metaphor for the state of Danish taxes (photo: Pixabay)
June 9th, 2019 5:00 pm| by The Copenhagen Post

Some 11 percent more Danes believe it is unacceptable to avoid paying taxes than they did in 1981, according to a recent study, but many are being given a helping hand by the authorities.

Great for car owners
New figures from the Skattestyrelsen tax authority reveal that 230,000 car owners owe 750 million kroner in unpaid car taxes, and around 100,000 cars are driving around that should have had their number-plates removed.

The main culprit appears to be computer systems that just can’t communicate with one another.

Robots to the rescue
The tax authority is in the process of building a robot system that will be able to automatically send registration numbers to the police.

Around 130,000 cases are at present with the Gældsstyrelsen debt-collecting authority, and they are waiting for the new PSRM system to be implemented to enable automatic debt collection.

If all goes well, the system should be fully functional in 2021.

Rising inequality
In Denmark more than most other European countries, car owners tend to be well off – so many might be buoyed to learn that the richest Danes’ share of the country’s total income has risen to 11 percent – from around 7 percent in early 1990.

The figures, which were calculated by the think-tank Kraka in conjunction with consultancy firm Deloitte, puts Denmark on a par with the UK and ahead of Norway and Sweden where the figure is around 8 percent.

The trend, which has accelerated since the financial crisis, has been driven by top executive wages and increased income from accumulated wealth.

Political will
Socialdemokratiet would like to reverse the trend by restricting the amount people can deduct on salaries over 10 million kroner and by introducing higher taxes on income from accumulated wealth.

“It’s not about envy, but about justice, reasonableness and social cohesion. An equal society is also a more stable one,” Peter Hummelgaard, its political spokesperson, told Jyllands-Posten.

However, the finance minister, Kristian Jensen, is not worried. “Of course there is a limit to how unequal a society can become, but I don’t think Denmark is there yet. We shouldn’t fight wealth but poverty,” he said.

Shah’s defence
In related news, Sanjay Shah, the Dubai-based British businessman at the centre of the biggest tax fraud case in Danish history, has denied all charges.

SKAT last year formally brought charges in a London court in an attempt to claw back some of the 12.7 billion kroner that had been paid out to Shah and an international network of investment banks and private individuals based abroad.

However, Shah claims he only exploited loopholes in the law that other European countries had managed to close, and he blames the Danish authorities for not being sufficiently awake to their vulnerability to dividend arbitrage, which is based on exploiting such loopholes.