Tax policy at the outskirts of EU: Greenland

This paper provides an assessment of Greenland's tax system and contemplates changes that may beundertaken in the future to prepare for greater economic self-reliance and for the country's participationin the wider world economy. At the outskirts of Europe, Greenland is an autonomous part of theDanish kingdom, though currently not a member of EU. However, its cooperation with Europeancountries and its dependency on international trade renders it necessary for the tax system in Greenlandto be attuned to developments in the rest of the world. Drawing on a thorough international benchmarkinganalysis of Greenland's tax system, the paper's special focus will be on the corporate tax systemand its interplay with personal taxation, as well on as the system of import duties. In particular, wecarry out computations of effective marginal and average corporate tax rates, as well as average effectivetax burdens on consumption, labour income and capital income, and compare these to similarmeasures for EU countries. In addition, we outline how Greenland's economic policy in other areasinterferes with tax policy. Especially fishery regulation, management of government-owned companies,and housing policy have major implications for the tax system.Key words: international benchmarking, effective tax rates, GreenlandJEL: H20, H25