Danish people pay about 40pc of their income as taxes: official

Danish people pay about 40 per cent of their income as taxes and in return get free education and heath facilities.

Revenue figures shared by the Danish tax officials indicate that in 2017, taxes contributed to almost half ($ 145 billion) of the country's total Gross Domestic Product (GDP).

Last year taxes contributed more than 64% to the GDP of the country and according to the country's tax officials this is all because people have trust in their government and think whatever it charges them will be spent on their health, education, social security and other benefits.

During a meeting with the senior officials of Denmark's Taxation Ministry it was revealed that Denmark was at the top in world ranking with regard to provision of various social security benefits to its people-a welfare state ideally matching Prime Minister Imran Khan's vision-and this is possible largely because of the taxes it imposes on its citizens (almost half of their income goes in taxes).

Head of International Coordination of Taxation Ministry Matthias Kisling Harris shared details of taxation in Denmark saying that according to a survey 63 per cent Danes think they pay 'suitable amount' of their income in taxes while only 29 per cent thought they were paying 'too much'.

In an interaction with Pakistani expatriates, it transpired that they have full confidence in the taxation system of Denmark.

"We pay tax and in return we get all types of facilities. If this system is implemented in Pakistan, it would take the state to a new peak," said, Raja Zafar Iqbal.

In Denmark, according to tax officials everything is electronically registered and the government imposes taxes even on social security funds that are spent on the poor and the needy including the unemployed, deserving individuals and even they are willingly pay taxes as they know it is not going to be wasted.

Denmark's taxation ministry charges both direct (income taxes) and indirect taxes, he said explaining the indirect taxes include Valued Added Taxes (VAT), Green Taxes, car registration taxes (150 percent of the car value plus 25 per cent VAT) and Church taxes.

When asked why cars are heavily taxed in Denmark, he said the purpose was to reduce emissions and the government wanted to promote a culture of bicycling and to discourage use of cars that cause pollution, accidents and shrinking of space.

On church tax he said almost 80pc of the Danish people pay church taxes (0.9pc) as every Dane who is baptized is registered with the church and the money collected thus is spent on churches construction and welfare of those associated with churches.

To a question, another official of the taxation ministry Christian Brande said every Dane had a story to share as how he was supported in difficult hour by the Danish government's social security network.

Copyright Business Recorder, 2019

Read Comments