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French boss in hunger strike over taxes

The owner of a security company has gone on hunger strike outside a French tax collectors office, in protest at taxes that he says threaten to sink his firm.

Published: 30 July 2012 10:36 CEST

Aldo Toscano, owner of a security firm in the town of Mazamet, east of Toulouse, stopped eating food for four days. Instead he camped out in front of the tax collector’s office in one of his company cars, daily La Depeche reports.

Toscano, a former soldier, also launched a petition to save his company.

He insists the taxman’s decision to freeze all earnings on his accounts means he won’t be able to pay his 20 employees their July salaries. Toscano owes money to the state but is asking for a 6-month period of grace to pay off his debts.

This weekend, Toscano agreed to stop his hunger strike when tax officers agreed to unfreeze company accounts.

Toscano however says a long-term solution has yet to be found. "I want to save my company, maintain our skills. We manage our business rigorously, but pay too many taxes."

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Beskæftigelsesfradraget: What is Denmark's employment allowance?

What is the employment allowance?

The Beskæftigelsesfradraget (from beskæftigelse, meaning employment, and fradrag, meaning rebate) was brought in by the centre-right Liberal Party back in 2004, the idea being that it would incentivise people to get off welfare and into a job.

Everyone whose employer pays Denmark’s 8 percent AM-bidrag, or arbejdsmarkedsbidrag, automatically receives beskæftigelsesfradraget. Unlike with some of Denmark’s tax rebates, there is no need to apply. The Danish Tax Agency simply exempts the first portion of your earnings from income taxes.

In 2022, beskæftigelsesfradraget was set at 10.65 percent of income with a maximum rebate of 44,800 kroner.

How did the government agree to change the employment allowance in its coalition deal?

In Responsibility for Denmark, the coalition agreement between the Social Democrats, the Liberals and the Moderate Party, the new government said it would set aside 5 billion kroner for tax reforms.

Of this, 4 billion kroner was earmarked for increasing the employment allowance, with a further 0.3 billion going towards increasing an additional employment allowance for single parents.

According to the public broadcaster DR, the expectation was that this would increase the standard employment allowance to 12.75 percent up to a maximum rebate of 53,600 kroner.

How might this be further increased, according to Børsen?

According to a report in the Børsen newspaper, the government now plans to set aside a further 1.75 billion kroner for tax reforms, of which nearly half — about 800 million kroner — will go towards a further increase to the employment allowance.

The Danish Chamber of Commerce earlier this month released an analysis in which it argued that by raising removing all limits on the rebate for single parents and raising the maximum rebate for everone else by 20,300 kroner, the government could increase the labour supply by 4,850 people, more than double the 1,500 envisaged in the government agreement.

According to the Børsen, the government estimates that its new extended allowance will increase the labour supply by 5,150 people.

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