According to BT, the majority of Danes are demanding a reduction in VAT on food.
Widespread support for reducing VAT on food products
According to BT, new data shows that a large majority of Danes want to reduce the value-added tax on food items to make it easier to buy everyday necessities from stores. Analysis conducted by the Norstat Institute for the merchants' association De Samvirkende Købmænd indicated that 80% of citizens support this move.
The report noted that food prices have become one of the most important political and discussion topics in the country, describing them as a “political hot potato.”.
A clear message from consumers
“The Danes are sending a clear message that they are fed up with one of the most complex tax systems in the world,” said Jannick Nytoft, executive director of the Danish Trades Association, in a press release. “Taxes and fees have become a burden on both consumers and shops, and it’s time for a fairer and simpler system,” he added, according to BT.
The report indicated that approximately 60% of the study participants were willing to accept higher taxes on other goods such as electronics and cleaning supplies, if this helped reduce the value-added tax on food items or lower the fees imposed on them.
Economic effects of the current system
Nytov asserted that “we have one of the strictest VAT and customs systems in Europe, which harms consumers” personal finances, promotes cross-border trade, and hinders the competitiveness of Danish shops.“ He added, ”Our analysis shows that it is possible to modernize the system in a way that is economically neutral for the country.” Calculations by the Merchants Association indicated that the cost of reducing taxes on food and eliminating some complex fees could be offset by raising the tax rate on non-food items to 27%, according to BT.
Official Proposal
Accordingly, the Traders Association proposed reducing the value-added tax on food items from 25% to 15%.
The report also noted that the Ministry of Finance recently announced that the path towards reducing the value-added tax on food items may have become longer, meaning that implementing the proposal requires more time and study.
