The Dark Side of Denmark’s Tax System: How Authorities Can Ruin Your Life Without Consequences

[EliasIT]

As many of you have probably followed, I've started several threads about my battle with the Danish tax authorities inside Mentor Group Gold!

The Danish tax system is so fundamentally corrupt that they can get away with absolutely anything they want. Even with undeniable evidence from my accountant, bank, and lawyer, who worked together to produce a thoroughly reviewed report on the case, the tax authorities can simply state that they stand by their claim that I committed tax fraud.

At a meeting with my lawyers yesterday, it became painfully clear that even they have, to some extent, just been lining their own pockets. I have to admit, they understood what happened in my company and got everything documented in writing, but even they say that taking a case to the Danish Tax Appeals Board is pointless. This so called board consists of public officials and private individuals who, within 15 minutes, decide whether the taxpayer is right or if the tax office wins. They don’t even review the case properly, just listen to a four-minute speech from a lawyer, which has already been submitted in writing beforehand!

What kind of justice system is this? It’s neither fair nor right when you can literally prove that the tax authorities are lying, fabricating stories, and, even when confronted with evidence, still stick to their claims just because they are the authority. You can take them to the High Court, or you can go to the media and hope that it makes a difference.

To everyone reading this who still thinks Denmark is a good place to run a business, avoid it at all costs. If the tax office sets its sights on you, they will destroy you completely. They are ruthless and only care about processing as many cases as possible to make their statistics look good.

If someone else had told me this before, I probably would have just scrolled past, thinking, 'Another person who did something stupid and is now playing the victim.' But that’s not the case.

Welcome to a new reality where authorities can ruin your life and confiscate everything you own. Get out of the EUSSR while you still can.

 

[lagloriacubana]

What is it that makes people so deeply sold on the whole “Scandinavian Way”? Like, how exactly do they get their citizens so convinced it’s the best system out there?

I’ve had a friend move back from Malta to Stockholm, another Danish friend who actually loves paying taxes (he reminded me of that simpsons cartoon character—Ned or something), and another buddy who left Canada to go back to Norway just so his kid could go to school there… and he didn’t even blink at the higher taxes.

But then I visit these places, I see the schools and hospitals, and yeah, they’re fine. But I also get top-tier private healthcare and education where I live - yes, it’s expensive, but still nothing close to the taxes you’d pay in Scandinavia.

And what really gets me is, none of these people even entertain another perspective. It’s like they’ve been wired to believe their way is the only “right” way. So I’m just wondering—what’s behind that? Is it cultural pride? Clever messaging? Subtle brainwashing? Honestly curious.

Just to add to what I was saying earlier—I think you can throw the Germans into that mix too. My German friends also treat paying taxes properly like it’s some badge of honor, and they seem to genuinely believe in their government. I’ve never really understood that mindset.

Honestly, the only one I truly respect there is the local kebab guy who’s been refusing to accept cards for 15 years straight I have visited him. Every time he says, “No brother, go geldautomat—cash only, keine cards,” I can’t help but smile. A true rebel. 0 Fs given.

Which brings me to the bigger point I’ve been thinking about: are these tax enforcers just doing their job… or are they true believers in a completely different belief system—one that most people in these countries have been slowly indoctrinated into over time?

 

[MarkT]

Not a MGG member, but wow your frustration is palpable.

I don't know where I read it many years ago: Happiest people are those who have passport from country A, money in country B, but live in country C. Guess you could add, and run company in country D.

And as per your "EUSSR", game plan of my richy or rich friends is just: Gather enough money so you are simply unaffected by normal people's problems. I.e. concierge medicine, private transport, structures abroad etc.

 

[EliasIT]

I don’t get what brings people back to Denmark or Scandinavia in general. I left a long time ago and have no intention of setting foot in that country again, even though I’m a Danish citizen.

If you ignore the taxes, fees, and insanely high living costs, where you’re left with barely 30% of your net income, it’s probably the mentality that draws people back. Everything is more relaxed and easygoing in Denmark, and it is a beautiful country, as the old songs say.

But that’s not enough. Scandinavia has completely changed, and so has Denmark. The country that was once charming, free, and a great place to live has turned into a monster, much like what we see in Germany, France, and the rest of Southern Europe.
But people are creatures of habit, they don’t realize how the incompetent government and the rest of the politicians have ruined the country. It’s like a lite version of what happened with Donald Trump in the U.S.

Tax office employees are mostly young people, many of them brought in from abroad because skilled professionals don’t want to work in the public sector. Either they’re working for big companies making more than double the salary, or, like many others, they’ve left the country altogether. In fact, 70,000 Danes have moved to Switzerland.

 

[JohnnyDoe]

You can replace Denmark in your post with any other EUKCH+ country.
Yes, some people are lucky enough not to ever have to deal with the tax/justice system and can swear that country X is the best, as long as you keep “proper” accounting. Good luck to them - and to you @EliasIT, because Switzerland is no different.

 

[daniels27]

@EliasIT not sure if you can read this. But I think there have been many like you here that have had issues with their tax authorities. With the Danish, with the Italian, with the German. Without knowing the details, it is always difficult to judge what is going on and who is right. But I think many of us can feel your feelings and will listen to your warning and follow your advice. Your reports over the time have been invaluable to many of us and I think each one of us appreciates your effort to spread the news.

Countries are Actors of a Free Market
While it may feel unfair to only have 30% of the salary at disposal, I must also state that for an average employee, the government benefits of Scandinavia largely outweights the tax benefits of Switzerland, especially during the years with kids. I know many that freely chose Finland over Switzerland to raise their kids simply because the high taxes are still cheaper than paying for daycare and health insurance. From that perspective, it is up to the population to decide on the countires policies and on whom to attract. (Unfortunately in recent years, voters have become more and more selfish and short-sighted, leading to policies that render their country's business model unsustainable in the near future.)

Is Switzerland better?
I would say that Switzerland does outperform pretty much most of Europe from that perspective. But I must also warn all, that this place is still on earth and far from heaven. Business wise, my impression is that the tax authorities are better as they are all on a city or cantonal level and are in competition with other cities and cantons. They have a much better understanding of a free market and know that high taxpayers are quite flexible on where they live (unless they have factories in the area). Hence, you will have an easier time to negotiate a ruling etc. that will give you safety.

But to be frankly honest, also in Switzerland, there are many cases where people had to pay substantial amounts for sometimes hard to eat decisions. And then, the court fees are substantial. There are many people that get a prosecuted and simply pay fines up to 2000 as any recourse in court most likely entails additional 2000 court fees.

Good luck to them - and to you @EliasIT, because Switzerland is no different.

He has been warned

Post in thread 'How Secure is Switzerland When it Comes to Protecting Wealth and Assets?'

Sep 18, 2024

I think maybe one day, we should open a Sewitzerland forum here. I know that there are many people here from EUSSR admiring the country like we admire cows and milk. But how many here grew up in this country? How many went through all the schools, courts and prisons? I once had a conversation with a head of canton (as usual in Switzerland, there is more than one president on most levels) and told him directly into his face that I believe that a good half of all penalty orders are erroneous and the prosecuted would have serious arguments to oppose when I would call them. Of course, he...

• EliasIT

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[JohnLocke]

I don’t have much more to add beyond what has already been said, but I have been in the same situation as you. I still have an ongoing case, and it looks hopeless.

That being said, it is deeply problematic that the tax authorities hold so much power while the ordinary citizen has no say when it comes to tax matters. That is not how a democracy should function. Moreover, if there is clear evidence, a tax authority should not be able to simply dismiss a case, hide behind its status as an official institution, and smugly declare that yet another taxpayer has fallen into their trap.

There is no proper legislation governing this, it’s essentially a "free for all" for tax officials. They might as well have a button like Google’s old "I'm Feeling Lucky", where the system randomly selects a taxpayer to be put through the grinder.

From my perspective, this has nothing to do with fairness or justice, it is pure abuse of power!

 

[JohnnyDoe]

From my perspective, this has nothing to do with fairness or justice, it is pure abuse of power!

It is not an abuse of any kind, it is simply how the system works.
Law ≠ justice.

 

[JohnLocke]

It is not an abuse of any kind, it is simply how the system works.

and you find it OK and perfectly fine how they it works?

 

[daniels27]

and you find it OK and perfectly fine how they it works?

I think nobody finds it OK. But I think there are not many better alternatives.

 

[JohnnyDoe]

and you find it OK and perfectly fine how they it works?

There’s no moral in the law and in business. Their game, their rules. If I choose to play it, I must know their rules, and accept the risks.

 

[JohnLocke]

There’s no moral in the law and in business. Their game, their rules. If I choose to play it, I must know their rules, and accept the risks.

I think you have a somewhat black-and-white perspective on this issue. While it may be true that these unwritten rules exist, if no one speaks up, nothing will ever change in this world. And if there is a clear imbalance of power between the tax authorities and the citizens, shouldn't we highlight it rather than simply accepting it and letting it pass?

I am sure you are highly active in your business life and don’t just let things slip by, you seize opportunities and make the most of them, which is completely understandable. So why not take the opportunity to speak out about the tax authorities if they are deliberately abusing their power? The entire essence of OCT is about information, keeping people informed about what is happening, both the good and the bad.

I hope you understand that this is not an attack but simply a professional and objective discussion. I am approaching this at a professional level, and there is no anger involved

 

[JohnLocke]

I think nobody finds it OK. But I think there are not many better alternatives.

You have to speak up, that's the only way to bring about change, in my opinion.

 

[Nicholas Van Orton]

There’s no moral in the law and in business. Their game, their rules. If I choose to play it, I must know their rules, and accept the risks.

I think that's a sensible approach, and believe one that has worked well for @JohnnyDoe over the course of years. I learned back in the day from the "Pelayos" roulette case, that even if you play by the "visible" rules, if you don't know ALL the rules (particularly those concerning breaking the "bank") of the field you're playing in, you may get into trouble. They FAFO, learned their lesson and moved on to better places, where they ended up cashing in big.

And there was not point for them to blame it on the casinos. I mean they won "in theory" a lot of court cases and appeals, but what did they gain out of it? Zilch. So they had to get creative and find fortunes elsewhere.

 

[daniels27]

You have to speak up, that's the only way to bring about change, in my opinion.

Yes, of course. Always! Even if it costs you time and energy.

When @JohnnyDoe said that this is how the system works, I pointed out the lack of alternatives. What I meant is that justice is very hard to achieve in the sense of that if something is under-regulated, it will be abused by malicious players, while during over-regulation, you will get collateral damage as we can see it in Denmark from numerous users here. Of course, Switzerland has some adantage of having tax auditors with more deciding power, something which easily can backfire as corruption. It is a bit like Ted Kaczynsky explains it in his essay Industrial Society and Its Future.

 

[polonieth]

What is it that makes people so deeply sold on the whole “Scandinavian Way”? Like, how exactly do they get their citizens so convinced it’s the best system out there?

I’ve had a friend move back from Malta to Stockholm, another Danish friend who actually loves paying taxes (he reminded me of that simpsons cartoon character—Ned or something), and another buddy who left Canada to go back to Norway just so his kid could go to school there… and he didn’t even blink at the higher taxes.

But then I visit these places, I see the schools and hospitals, and yeah, they’re fine. But I also get top-tier private healthcare and education where I live - yes, it’s expensive, but still nothing close to the taxes you’d pay in Scandinavia.

And what really gets me is, none of these people even entertain another perspective. It’s like they’ve been wired to believe their way is the only “right” way. So I’m just wondering—what’s behind that? Is it cultural pride? Clever messaging? Subtle brainwashing? Honestly curious.

The brainwashing starts virtually at birth. Most kids in these countries are shipped off to "kindergarten" at around 1 year old. That means you're essentially co-parenting with the government, and the wonders of the state are implanted into their impressionable young minds.

Plus, most Danes/Norwegian exposure to media is via state-owned channels, essentially government stenographers. Very few of them seek alternative sources for information. So their worldview is shaped by what they see on NRK/TV2. Hyper vaccinated, hyper pro-Ukraine, hyper anti-trump, hyper anti-musk societies. I mean you got Norwegians damaging they're own Teslas

 

[JohnnyDoe]

I think you have a somewhat black-and-white perspective on this issue. While it may be true that these unwritten rules exist,

I think that the situation is very simple. There is the law, which is written and public; there is case law, which is largely accessible; and settlements, most of which remain private, but are not essential for our knowledge (it’s sufficient to know that a large number of tax cases is settled).
What you define a “black-and-white perspective” is a pragmatic and disillusioned understanding of the system.
I refrain from judging it as good or bad, because as I said moral is not an element of the law. I learned that the legal system operates as a game administered, played, and continually reshaped by the same entities that write, interpret, and enforce its rules.

if no one speaks up, nothing will ever change in this world.

The game will change only when enough people will refuse to play it. It will either change to attract more players or collapse. The U.S., for example, have chosen the former, the EU as it stands now is destined to disintegrate. There will always be competition in some form between states, and one is free to choose where to play.
I choose to speak up to help people understand the world they live in and make the best out of it and of the cards they have been given. You can bring the horse to the water, but you can’t make it drink.

And if there is a clear imbalance of power between the tax authorities and the citizens, shouldn't we highlight it rather than simply accepting it and letting it pass?

The tax authorities are just the picciotti collecting the pizzo for the mafia state.

I am sure you are highly active in your business life and don’t just let things slip by, you seize opportunities and make the most of them, which is completely understandable. So why not take the opportunity to speak out about the tax authorities if they are deliberately abusing their power?

I choose to pay tribute to the mafia state that best serves my interests, purely as a matter of personal convenience. I am no Don Quixote tilting at windmills. States eventually realize that they must attract subjects with a carrot rather than relentlessly striking them with a stick, or they will collapse

The entire essence of OCT is about information, keeping people informed about what is happening, both the good and the bad.

I agree! It’s not a complaint board.

I hope you understand that this is not an attack but simply a professional and objective discussion. I am approaching this at a professional level, and there is no anger involved

I understand, and there is no need to be angry with the tax authorities either. If one pursues freedom and helps others do the same, the world will eventually change on its own terms.

 

[EliasIT]

I'm really glad to see the engagement you all have in my case and to read your thoughts and opinions. This is exactly what’s needed to create a good dialogue.

I agree with most of what’s been said here, and I’ll take some time to reflect on it.

Everyone has to handle their own problems in their own way, whether it works out or not.

 

[Alonzo]

Denmark is only great if you are willing to work 9 to 5 till retirement age. Salaries for the average employee are high while effective tax rate on that income is somewhat reasonable. Plus of course the benefits you have in exchange

 

[sebastian]

Denmark is only great if you are willing to work 9 to 5 till retirement age. Salaries for the average employee are high while effective tax rate on that income is somewhat reasonable. Plus of course the benefits you have in exchange

if you want to do nothing or have the 8 to 16 job it's a great country for entrepreneurship you can forget about it.