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Austria balks at introducing property tax

The State Secretary of Finance Jochen Danninger (ÖVP/Austrian People's Party) says his party remains opposed to the introduction of property taxes in Austria.

Published: 8 July 2014 12:55 CEST
Austria balks at introducing property tax
Finance state secretary Jochen Danninger. Photo: APA/HELMUT FOHRINGER

Prior to a meeting of EU finance ministers on Tuesday in Brussels he told the Austrian Press Agency (APA) that such a tax would be "out of the question" for the ÖVP.  He shared his colleagues' opinion within the Eurogroup that the tax-burden on labour was too high and that a tax relief was necessary.

The European Commission had called on Austria and ten other countries to reduce taxes on labour. However, this could only be obtained by a structural reform, Danniger said. Every euro saved by such a reform should be used to reduce taxes on labour, he added.

Danninger again warned that tax relief on the basis of new public debt would be "the worst way".  That's why he also strictly opposed a property tax as wanted by the ÖVP's coalition partner the Social Democrats (SPÖ), saying that sustainable tax relief could only be achieved by structural reforms.

Austria has no property taxes, apart from stamp duty, a small tax incurred upon sale, unlike the UK which has some of the highest property taxes in the world.

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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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