The prize for highest tax rates goes to Denmark

Denmark has just received the "prize" by the OECD for being the first country where tax revenues are now more than 50 percent of the GDP. Even though the country is not fully over the economic crisis, the Danish State have managed to increase tax revenues to a level so that Danes now pay 53 percent of all income earned in Denmark in taxes, says Niels Westergård-Nielsen, Professor, Ph.D. CBS, in an article in Berlingske Tidende.

01/04/2016

Low GDP growth and an increase in public spending will provide a high tax share of GDP, but it is not the main explanation for why other European countries are doing better than Denmark. If you look at the economy as measured by GDP constant prices development since 2007, Denmark have lost about six percent of its GDP. Iceland and Ireland appear to have lost less than Denmark despite their increasing debt burden, and the United Kingdom is in 2014 in line with the situation before the crisis. Germany have won by having had five percent growth over 2007.

In an article from the newspaper Berlingske Tidende Niels Westergård-Nielsen argues why it is deeply worrying that Denmark, in its critical situation, have such high taxes in relation to the GDP. One of the problems of the Danish economy is that the consumption haven't gained momentum yet. One of the reasons why it is so difficult to get the Danish economy going again, is that citizens and businesses in particular continue to be forced to cater for both the State and the banks as they have to pay high taxes, high interest rates and service debts.

Read the entire article (in danish) in Berlingske Tidende here:
Ny, kedelig skattepræmie kan kvæle opsvinget, inden det får begyndt
Niels Westergård-Nielsen, december 2015

The page was last edited by: Centre for Owner-Managed Businesses // 10/08/2019