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TOURISM

Danish business organisation calls for tax breaks on leisure

A major interest organisation for Danish businesses has proposed tax deductions for visiting tourist attractions, temporary reduction of the value-added tax (moms) rate, and millions of kroner in state support to help get the tourism and experience industries in Denmark going after a long shutdown.

Danish business organisation calls for tax breaks on leisure
The Big Bio cinema in Copenhagen. Photo:Asger Ladefoged/Ritzau Scanpix

The Confederation of Danish Industry (DI) presented on Wednesday twelve proposals to help the hard-pressed sectors.

“Something needs to be done now. Many of our neighbouring countries have already gone on the offensive to ensure that their hotels, restaurants, and attractions emerge from the crisis strongly,” DI’s deputy director Henriette Søltoft said.

“We will also have to do this if we are not to be outcompeted by attractions abroad,” she added.

DI has therefore proposed a stimulus package that will increase activity in the sector, lower costs for businesses, and support development and restructuring in the wake of the coronavirus crisis.

Among the proposals is to introduce a tax deduction in the style of the existing deduction applicable to home improvements (håndværkerfradraget) on services valued over 250 kroner.

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The deduction would apply for two years and allow taxpayers to deduct value-added tax (moms) from their tax return when, for example, they visit a restaurant or the cinema.

“Our hope is that this will seriously get Danes using all the fantastic leisure options that we have here at home,” said Søltoft.

DI is also calling for a lower value-added tax rate of 12.5 percent for hotels, the restaurant industry, and amusements, valid for one year.

The organisation argues this will improve the price level and be in line with similar initiatives in Norway, Germany, and the United Kingdom.

DI has not estimated the cost of the plan for the Danish treasury. But the organisation writes in the proposal that it is necessary to consider unconventional methods in an extraordinary situation, even if it will be costly.

Other proposals from DI are to set aside 200 million kroner for restructuring of the cultural industries and 200 million kroner for innovation in the tourism and leisure industries.

Denmark’s tourism industry saw a 31 billion kroner drop in its turnover in 2020, according to DI.

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ECONOMY

Swiss central bank announces big rate hike in inflation fight

The Swiss National Bank (SNB) raises the key interest rate by 0.75 percentage points, putting it back in positive territory at 0.5 percent.

Swiss central bank announces big rate hike in inflation fight

“The rate change applies from tomorrow, September 23rd 2022”, SNB said in a press release on Thursday.

It added that “inflation [in Switzerland] rose to 3.5 percent in August and is likely to remain at an elevated level for the time being”.

The latest rise in inflation is principally due to higher prices for goods, especially energy and food, according to the bank.

The SNB’s forecast for the evolution of inflation is, however, positive.

It forecasts that the rate will drop to 2.4 percent in 2023 and and 1.7 percent for 2024.

“Without today’s SNB policy rate increase, the inflation forecast would be significantly higher”, the bank said.

In mid-June, the SNB tightened interest rates by half a percentage point for the first time in 15  years. Since then, inflation in Switzerland has continued to rise. For August 2022, the statisticians reported inflation of 3.5 percent, after 3.4 percent in June and July.

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