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Deutsche Bank HQ raided in tax fraud probe

Deutsche Bank said Wednesday that one of its co-chief executives Jürgen Fitschen was under investigation in an ongoing probe into alleged tax fraud at Germany's biggest lender.

Published: 12 December 2012 15:09 CET
Updated: 12 December 2012 17:09 CET
Deutsche Bank HQ raided in tax fraud probe
Photo: DPA

Prosecutors and tax police raided the offices of Deutsche Bank Wednesday in a probe dating back to 2010, and “in connection with this, two management board members Jürgen Fitschen and Stefan Krause are also being investigated,” Deutsche Bank said in a statement.

The probe at the bank’s headquarters in Frankfurt includes 25 employees.

The bank’s workers are suspected of serious tax fraud, money laundering, and obstructing justice in connection with the trade in European Union CO2 emissions certificates, Frankfurt state prosecutors said on Wednesday. Arrest warrants have already been issued for five of them.

Investigators also searched several homes and offices across Germany as part of the same operation, including some in Berlin and Düsseldorf. The probe – into the suspected evasion of valued added tax (VAT) on emissions trading – has been running since the spring of 2010.

Deutsche Bank Frankfurt offices were already raided then, but investigators believe that evidence may have been hidden from them, they said Wednesday. Deutsche Bank released a statement saying the bank will cooperate fully with authorities.

A Frankfurt court convicted six executives of other firms of tax fraud as part of the same operation last year. They had confessed to evading at least €230 million of VAT in the Europe-wide trade in CO2 emission certificates.

The company managers had bought the certificates VAT-free outside Germany, sold them on cheaply – sometimes to Deutsche Bank – and claimed the VAT back from the tax office.

The EU emissions certificate trade system allows certain companies to release a certain amount of carbon dioxide into the atmosphere. If a given firm releases less, it is allowed to sell the surplus on in the form of a certificate.

Fitschen and Krause, who is the bank’s finance chief, are under investigation because they signed off the bank’s 2009 VAT declaration, the bank explained.

“But that tax declaration has since been corrected voluntarily by the bank. Unlike the prosecutors, Deutsche Bank is of the opinion that the corrected declaration was submitted in a timely manner,” it said.

“Deutsche Bank is cooperating fully with the authorities,” it added.

The Local/AFP/DPA/bk

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TAXES

Beskæftigelsesfradraget: What is Denmark’s employment allowance?

Denmark's government may soon announce changes to its tax reform plans, which will give all wage earners a bigger employment allowance. What is this and how will it affect foreigners' earnings?

Published: 30 October 2023 15:21 CET
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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