Commission to delve into tax audit scandal
Mystery memo suggests possible meddling with PM's tax audit, says tax minister
The government will appoint an independent commission to investigate whether Venstre politicians at the tax ministry interfered in the ongoing tax audit of PM Helle Thorning-Schmidt and her husband Stephen Kinnock in the summer of 2010, back when Thorning-Schmidt was opposition leader and VenstreÂs number one threat.
The then-tax minister, Troels Lund Poulsen (Venstre), or Poulsen's spindoctor, Peter Arnfeldt, ÂpossiblyÂ authored a memo that was delivered to the Copenhagen tax authority Skat with a recommended judgment on Thorning-SchmidtÂs tax audit, according to the tax ministryÂs highest-ranking civil servant and top aide, Peter Loft.
Last month, the current tax minister Thor MÃ¶ger Pedersen (Socialistisk Folkeparti) asked Loft and Erling Andersen, the head of the Copenhagen Skat, to give him their written explanations of why they met five times in the summer of 2010 to discuss Thorning-SchmidtÂs personal tax audit, and why Loft apparently gave Andersen the memo with the recommended judgment on Thorning-Schmidt and KinnockÂs audit. Those explanations were delivered to Pedersen last week and contained the explosive allegation that Poulsen or Arnfeldt may have authored the memo.
Under Danish law, the Tax Ministry is not allowed to interfere with active, personal tax cases.
Moreover, at the time of the audit, the Venstre-Konservative government was in severe danger of losing the upcoming election, and Thorning-Schmidt was the person most likely to win it Â as indeed she went on to do in September 2011.
On Friday, Pedersen announced at a press conference that LoftÂs and AndersenÂs explanations about the meetings contained ÂcontradictoryÂ information.
Andersen wrote in his explanation that Âthe permanent secretary [Loft] gave me a memo. There was no indication of who had written it. Of course I asked Peter Loft about it, but got the answer that he didnÂt know. It had just turned up.Â
Loft also mentioned the memo in his explanation, adding that he ÂdidnÂt know where it came from."
ÂI think that I got the memo from the tax minister [Poulsen] or from his special counsel, Peter Arnfeldt," Loft's written explanation said. "I donÂt know where the memo came from Â possibly from VenstreÂs press officer.Â
The mystery memo allegedly provided judgments on various aspects of Thorning-SchmidtÂs audit, with a final recommendation that her husband, Stephen Kinnock, should be deemed liable for taxation in Denmark.
Such a judgment would have put Thorning-Schmidt in the awkward situation of having to justify why Kinnock had not been paying taxes in Denmark.
Ultimately Skat cleared Thorning-Schmidt and Kinnock of tax evasion Â and Andersen wrote in his independent explanation that the memo with the mystery author Âwas not used, because the assumptions in it were not correct in relation to the actual circumstances of the audit.Â
Loft explained that he gave Skat Copenhagen the memo without knowing precisely what was in it.
In September, 2011, just before the parliamentary election, Thorning-Schmidt's audit was leaked to the press along with Thorning-Schmidt and Kinnock's CPR numbers. Loft himself went to the police to ask for an investigation into the leak.
In his press conference on Friday morning, Pedersen said that an independent commission led by a judge would be formed to Âget to the bottomÂ of the entire case. He noted that the commission would explicitly investigate whether the former tax minister Poulsen or VenstreÂs press officer had anything to do with the ministryÂs interference in the then-opposition leaderÂs audit.
ÂItÂs a serious case, so every stone must be turned over,Â Pedersen said. ÂThe government believes that there are questions here that parliament cannot disregard.Â
Pedersen added that he still had Âcomplete trustÂ in Loft and Andersen.
Directly following PedersenÂs announcement, Poulsen held his own press conference and announced that he had nothing to hide and welcomed the investigation.
ÂI look forward to speaking about it so that I can clarify what my role was in the case. But an investigative committee doesnÂt consist of journalists,Â the former tax minister told the assembled journalists.
Until Friday, Poulsen had claimed that a pledge of ÂconfidentialityÂ prevented him from commenting on the case.