With a major tax reform and promises to push ahead with work permit reforms, the policy program of Denmark’s new government promises to make life slightly easier for many foreigners living in the country.
TAX
The new government has promised to bring in major tax reforms, with changes to income tax, corporate tax, and VAT, all of which will have an impact on the wallets of foreigners living in Denmark.
According to the liberal think tank Cepos, these changes will benefit high earners, with working-class families likely to receive DKK 8,700 extra in tax breaks per year, while a company director’s family will be able to keep almost twice as much more – DKK 16,400 – for themselves a year.
Scrapping income tax bands
The government plans to abolish the top two income tax brackets top-top taxand middle tax.
Instead there will simply be a base tax for incomes up to DKK 777,900 and then a top tax of an additional 15 percentage points for incomes above that.
Cutting corporate tax
The government has said it will lower corporate tax by three percentage points over three years to 19 percent.
Higher ceiling for share savings accounts
The government plans to reform the tax on capital by increasing the maximum amount people can save in a low-tax share savings account (aktiesparekonto), to 500,000 kroner. Investments held in these accounts pay on 17 percent tax on any capital gains.
Halving VAT on food
Foreigners sick of paying through the nose at Danish supermarkets will get some relief, with the government promising to halve VAT on food from today’s 25 percent to presumably 12.5 percent, and to abolish VAT entirely on fruit and vegetables.
The government plans to partly fund this by dropping plans to remove the tax on chocolate and sugar.
WORK PERMITS
Pushing ahead with new law easing work permit requirements
The new government in its program has committed to pushing ahead with a delayed law easing work permit requirements for employers recruited from non-EU countries by companies which have signed a collective bargaining agreement.
The new law was due to go before parliament on March 19th, but was shelved when the election was announced, and will now need to be resubmitted to parliament by the new government.
The new law will allow people from selected non-EU countries to get a work permit even though the salary they are being offered is below the minimum level stipulated in the Pay Limit and Supplementary Pay Limit schemes.
To be eligible for such a permit, the companies will need to be certified in a similar way to companies eligible to use the Fast Track list are today.
Continue recruitment for care roles internationally
The government has pledged to continue recruiting internationally for roles in elderly care and healthcare.
“This must be done by continuing the path of training and recruiting international labor via partnership agreements, ensuring sufficient language skills, and investigating the possibilities of dividing caregiving and practical functions to a greater extent between care staff,” the government program reads.
Pushing ahead with the requirement for ID cards at major building projects
To reduce the risk of construction companies and subtracted using illegal foreign labour, the government also wants to push ahead with a proposal, agreed between political parties under the last governemnt to require all workers on major construction sites to carry ID cards at all times.
IMMIGRATION AND INTEGRATION
Despite the inclusion of the pro-immigration Social Liberal and Green Left parties, Prime Minister Mette Frederiksen has been adamant that the new government does not signal an end to Denmark’s tough line on immigration.
Frederiksen pledged that more criminals with foreign backgrounds would be deported under the new government on the back of a new law reforming deportation rules which will be submitted to the Danish parliament.
She added that the government also wanted to continue working to establish reception centers outside the European Union, where asylum seekers would be housed while their requests were processed.
