Denmark Overhauls Maligned Tax Administration

A complete restructuring of the Danish tax administration went into effect 1 July 2018.

Provoked by a 2015 scandal involving some DKK 12.3 billion in fraudulent refund claims for dividend withholding, the government fired the director general of its tax administration in 2016 and embarked upon a complete overhaul of its tax administration system.  

Under the new plan, the old tax administration has been eliminated, and replaced by seven separate agencies each responsible for a different aspect of tax administration.

The seven new agencies are responsible for:

  • Tax administration
  • Debt management
  • Assessments
  • Customs
  • Motor vehicles
  • IT systems

The overhaul includes the hiring of more employees and new IT systems as well.

Related: Australia Cuts Personal Income Taxes

How This Impacts Mobility

Companies accustomed to dealing with the old tax system in Denmark will need to change their systems to account for the new administration. For example, tax issues dealing with employees will now be administered in a new part of the tax authority, and all dealings with it may be slower and more difficult as the new system is implemented. In addition, it is expected that enforcement activities will increase with additional personnel and more advanced IT systems.

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