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French tax returns to be simplified, minister vows

Despite having numerous public holidays, most French people dread the month of May because it means spending hours filling in their tax declaration forms. France’s finance minister promised on Wednesday the process would become easier.

French tax returns to be simplified, minister vows

French Finance Minister Pierre Moscovici suggested on Wednesday the end was near for France’s arduous annual process of filling in tax declaration forms.

In an interview with Le Parisien, Moscovici announced that the “declaration des revenus” which must be carried out each year before the end of May, is going to be simplified.

The idea however is not so much designed to save taxpayers time but to save the government money in a period of austerity.

Currently taxpayers are asked to send in supporting documents such as certificates of donations to charities or receipts of childcare costs, which often requires an afternoon spent in front of a photocopier.

But to the relief of the public and a government sinking under the weight of paperwork, those days are over, the minister revealed.

“We have been working hard at the ministry to ensure that the tax return process is simplified,” the minister said. “For the first time we will no longer ask those who make their declaration on paper to attach all their supporting statements.

“We will also make sure the form for calculating the taxes is easier to read and we will be encouraging more people to make their declaration online."

Moscovici also said this year the French will not receive the traditional letter from the Ministry of Finance reminding them to pay their taxes. Instead emails will be sent out which will save an estimated €850,000.

In France, taxes are calculated on a calendar year basis with the public forced to complete and send back a declaration by the end of May the following year.

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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?

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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