Business Round-Up: The taxman who keeps on ringing
Ever noticed how nobody ever protests about the usage of the word taxman. They complain about the use of actress, chairman, and freshman even, but never taxman. In truth, nobody ever rallies to their cause, and they do tend to get a bad press.
Plenty coming back
This past fortnight has been different, though. While it’s accurate to say he taketh away, he also giveth, and fortunately for us law-abiding citizens, he has mostly been giving.
Some 3.4 million lucky citizens (so pretty much everybody) have together shared 16.2 billion kroner over the past month – owing to them paying too much tax in 2018. On average, that is 4,717 kroner per person.
Nevertheless, Karoline Klaksvig, the deputy head of Skattestyrelsen, doesn’t think the overpayment of tax is a good thing, and she urges people to keep a better check on their preliminary income assessments – especially if there are big changes in their lives such as a property purchase, new job or a divorce.
Money well spent
On the flip-side, around 1 million Danes have paid too little and together they owe an estimated 6.3 billion kroner, but that is a drop in the ocean compared to the 315 million kroner owed in taxes by the 155 Danish entities implicated in the Panama Papers.
The Tax Ministry paid just over 6 million kroner for information from the April 2016 leak pertaining to Danes – principally regarding how a Panamanian legal firm had set up tax evasion schemes using strawmen in tax havens to prevent the relevant authorities finding out how much tax was owed and by whom.
The tax minister, Karsten Lauritzen, feels that 6 million kroner was money well spent. However, time will tell how much is paid back.
In total 8 billion kroner has been demanded back worldwide, with the UK (1.6 billion), France (900 million) and Australia (600 million) among the big claimants.
Huge legal fees
In related news, pursuing foreign entities that exploited a loophole in the Danish system, which enabled them to get their withholding tax reimbursed, is a costly business as the state owes 2.4 billion kroner in legal fees to lawyers in the US, Canada, the UK, Germany and Luxembourg.
The lawyers are helping the state to recover 12.7 billion kroner, and they have brought cases against 470 parties in five countries.
And finally, the online property rental service Airbnb has announced that from July 1 the company will start automatically reporting information on rentals to the tax authorities – making Denmark the first country in the world to have an automatic agreement of this sort with a shared economy provider.
Ryanair on the charge
Ryanair intends to raise the number of its weekly winter season departures from Copenhagen from 94 to 135 from October 30. In other airline news, it has been confirmed that not everyone will get a refund on purchased tickets following the bankruptcy of Icelandic airline Wow Air.
IKEA thinking sustainably
From 2020 IKEA will trial a sustainable scheme that will enable customers to rent furniture instead of buying it. In other retail news, the first Fætter BR store has reopened following the Salling Group’s takeover of the toy store chain, and a ceramicist is suing Netto for allegedly stealing her design for a range of pottery. While her pots cost 350 kroner, at Netto they’re 39 kroner.
ECB questions ban
The European Central Bank has asked Denmark to reconsider its proposed ban on the 500-euro note – part of a package of anti-money laundering measures put forward in September last year. The ECB points out that Denmark allows other high-value notes.
A new contract with a private supplier is expected to achieve net savings of around 300 million kroner for 22 state bodies in terms of expenses for cleaning, canteen services and building maintenance.
Less lucrative thefts
The number of stolen credit and cash card instances has soared 500 percent to 9,766 cases in just two years – a rise attributed to the introduction of contactless payments. Nevertheless, the number of cases in which thieves used an ATM has plummeted. The average loss sustained by a PIN code/card theft is 3,599 kroner, whereas contactless card thefts on average yield 157 kroner.
Cost of failure
IT company KMD must pay the Tax Ministry 200 million kroner in regard to the blighted EFI system, which has been responsible for leaving the country’s tax recovery system in disarray. The payment settles an action launched by the ministry in 2016, a year after it closed down the EFI. A new system is being developed by Netcompany, which should be fully phased in by 2021.
Festival’s healthy profit
Foreningen Roskilde Festival, the fund running the Roskilde Festival, has announced the financial result of last year’s festival. Some 19.2 million kroner will be distributed amongst charities, especially focused on those for children and young people. Last year, the business and service side of the festival realised a record profit of 32.6 million kroner.
All change at Lego
Kjeld Kirk Kristiansen is stepping down from the Lego board – a generational shift that will see his son, Thomas Kirk Kristiansen, become the ‘active owner’ of the toy company. In other company news, transport and logistics company DSV has bought Swiss rival Panalpina for 30.5 billion kroner, and AmCham Denmark has named Rambøll as its Transatlantic Company of the Year.
Great Q1 for shares
After a poor 2018, the C25 index of the country’s leading shares enjoyed its best Q1 since 2015, rising 14.1 percent over the first three months. The performance mirrors the US, where shares have seen their best first quarter figures since 1998.
Taxi firm fined
Taxa 4×35 has been fined 1.2 million kroner for storing customers’ telephone numbers for more than the two years permitted by data protection regulations. In its defence, the taxi company said that deleting the customer’s number was problematic because the database used the number as the customer’s ID, but Datatilsynet rejected the excuse.
Support for BA students
In a bid to encourage more university students to enter the job market, the government has teamed up with over 100 of the biggest companies in Denmark as part of the new Bachelor Pledge initiative. It aims to give students with bachelor degrees better access to the job market and the option to return to university within three years.
At ease with feedback
Danes are more at ease about giving and receiving feedback than any of the 34 nations surveyed by the Randstad Workmonitor, an employee mobility study. Just 9 percent said they felt uncomfortable – the lowest rating of any country. Nevertheless, 31 percent said it was hard not to take negative feedback personally – the fifth highest figure.
Hard Brexit no problem
Danmarks Nationalbank is confident that the only nation that will be hit hard by a Hard Brexit is the UK. Danish exports to the UK, it predicts, will fall by only 1 percent, although certain sectors such as pharmaceuticals could fall by 20 percent. It forecasts Denmark’s economy will grow by 1.7 percent in both 2019 and 2020, and then by 1.6 percent in 2021.