Denmark's New Tax Reform Plan: Who Gains and Who Loses

Denmark's government agreed on a major tax reform with the Danish People's Party. High earners will gain the most from the new income tax rules. The agreement abolishes the middle tax rate and the top-top tax rate. It also lowers corporation tax and fuel taxes across the country.

Income tax savings will depend directly on how much you earn. A couple earning 80,000 Danish kroner each monthly saves 21,000 kroner yearly. A single worker earning 65,000 kroner monthly will save 4,300 kroner annually. However, a couple earning 58,000 kroner each receives no income tax reduction. Unemployed people and pensioners gain the least under the new reform.

The agreement also changes investment rules and vehicle costs for residents. The maximum limit for low-tax share accounts will triple to 514,600 kroner. Fuel tax cuts will save daily long-distance commuters about 2,400 kroner yearly. However, minimum car ownership taxes will increase to help cover costs.

Some residents will lose benefits under the new parliamentary agreement. Students living with parents earning over 710,077 kroner lose grants completely. Graduates must work part-time for 18 months to claim unemployment benefits. Minimum property taxes will rise to 650 kroner every six months.