Tax audit scandal under review at Justice Ministry

Top employees at Tax Ministry and Skat have turned in accounts of their controversial meetings on PM’s tax audit

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November 28th, 2011 3:45 pm| by admin
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Two written explanations concerning to what degree the Tax MinistryÂ’s top civil servant, Peter Loft, interfered in the personal tax audit of prime minister Helle Thorning-Schmidt and her husband Stephen Kinnock back in 2010 are now before the Justice Ministry.

But the verdict – as to whether the Tax Ministry under the previous administration was guilty of politically motivated meddling in the audit of the then-opposition leader – is still under wraps.

On November 14, the tax minister, Thor Möger Pedersen (Socialistisk Folkeparti) asked Loft and Erling Andersen, the director of tax authority SkatÂ’s Copenhagen office, to provide him with written explanations as to why they met a total of five times in the summer of 2010 regarding Thorning-SchmidtÂ’s taxes, why no notes were taken during the meetings, and why Loft allegedly sent Skat a paragraph of text to include in its decision, according to Politiken newspaper.

Under Danish law, the Tax Ministry is not allowed to interfere in on-going, personal tax cases – let alone that of a top politician.

In September 2010, Skat cleared Thorning-Schmidt and Kinnock of tax evasion, but a year later, just before the election that made Thorning-Schmidt prime minister, SkatÂ’s nine-page decision about Thorning-SchmidtÂ’s audit was leaked to the press

Loft himself was the one who came forward and asked police to investigate who leaked Thorning-SchmidtÂ’s audit. But shortly afterwards, the spotlight turned on Loft himself, when it was learned that he had met with Andersen five times regarding the audit.

Over the past weeks legal experts and politicians from both left and right have publically criticised Loft for his alleged entanglement in the sensitive audit. But Loft insisted that the five meetings only touched on the “principle aspects” of the case – and nothing personal.

A memo written by Skat Copenhagen on 20 January 2011, and obtained by Jyllands-Posten newspaper last week, appears to suggest that it was Skat Copenhagen – and not Loft or the Tax Ministry – that initiated contact over the audit.

“From the beginning the audit was determined to be a very sensitive case. Manager Erling Andersen therefore thought it both natural and advisable to discuss the case while it was ongoing with his superiors [including the permanent secretary Peter Loft],” Skat Copenhagen wrote in the memo.

The new information could alter the character of the case, said Roger Buch, head of research at journalism school Danmarks Media- og Journalisthøjskole.

“If it was Skat Copenhagen itself that asked for help, then [Loft] is in a less serious situation.”

The tax minister declined further comment on the situation after the memo from Skat was obtained last week and Loft and Andersen gave him their written explanations on Friday. The case is now being reviewed by the Justice Ministry, with a decision expected within weeks.

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