Danish tax authority demands huge compensation figure from IT firm

System failure could cost KMD over half a billion kroner

The Danish tax minister, Karsten Lauritzen, is demanding that the IT firm KMD pay 692 million kroner to SKAT, the national tax authority, due to ongoing problems with the EFI tax recovery system.

According to Børsen, Lauritzen has sent a letter to KMD asking for compensation.

“SKAT’s recovery system has not worked for years,’ Lauritzen wrote.

“Part of that responsibility lies with SKAT , but both the attorney general and SKAT have assessed that KMD has not delivered what was agreed to, and that has caused serious problems.”

See you in court
KMD, which is part of a consortium that delivered the recovery solution, said it was “shocked”.

“This action is unreasonable,” said KMD’s legal director Mark Nielsen. “We look forward to settling the matter in court.”

READ MORE:New governmental IT disaster raises old questions

The EFI system was originally scheduled to be up and running in 2007, but it did not go into service until 2013.

State accountants continuously criticised the system, which was finally put out to pasture last September, leaving tax-payers with a 14 billion kroner bill for a system that SKAT says never functioned correctly.