EU: Denmark unfairly taxes citizens who work abroad

Denmark may face legal action for violating the EU right to free movement by unfairly making Danes who work outside the country pay more tax than those who work in Denmark

The European Commission has accused the Danish government of unfairly making some workers pay too much tax, reports Ugebrevet A4

Due to Danish residents who earn some of their income in another EU member state receiving a lower tax deduction, A4 calculates that a worker earning at least half of their income in another EU country loses around 8,000 kroner a year.

Individual member states are responsible for setting their own tax laws, but the Commission argues that the Danish rule makes it less attractive for Danes to work in another country, and therefore breaks the EU’s right to free movement.

READ MORE: Anti-EU parties call for referendums to brake integration

EU legal challenges
A4 reports that the EC presented the Danish state with a formal notification of its concern about Danish tax rules this summer.

The government was given two months to respond before the EC starts legal proceedings against Denmark, but the Danish government has reportedly not yet replied.

Berlingske newspaper reports that Denmark does not have a good track record with EU legal challenges and may end up having to compensate thousands of workers.

Political outrage
The eurosceptic parties Enhedslisten and Dansk Folkeparti have condemned the EU for interfering with Danish tax law, with DF spokesperson Pia Adelsteen calling the situation “grotesque”.

“Tax law falls under our national jurisdiction, which the EU needs to stay far away from,” Adelsteen told A4.

Lead opposition party Venstre, however, said that the EU is trying to protect the labour market’s right to free movement, not Danish tax policies.

“It is about whether Danish workers are being treated fairly with regards to their income from foreign countries,” Venstre MP Eva Kjer Hansen told A4.