Abstract
This article argues that the "fiscal trilemma"-the tension between sufficient revenue and long-run fiscal sustainability on one side; medium- to long-run growth opportunities on the other; and progressivity and avoidance of inequality on the third side-is very much present in Denmark. We provide an overview of main features of the Danish tax system; the state of fiscal balances in the short and longer run; growth and productivity developments; and the extent of inequality in the Danish society. Thereafter, we go into details with reforms and changes in the tax system over the last twenty-five years and diagnose main problem areas. We argue that the tax reform carried in Parliament on September 13, 2012, does not pass a "trilemma test"; that is, it is in conflict with at least one of the three key considerations. Finally, we put forth reform elements that should improve the system
Original language | English |
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Journal | Public Finance Review |
Volume | 41 |
Issue number | 6 |
Pages (from-to) | 791-823 |
ISSN | 1091-1421 |
DOIs | |
Publication status | Published - Nov 2013 |