Wednesday, January 14, 2015
Danish Sanity Redux
Happy New Year and Hooray because the Danish politicians who want to tax printed advertising are rethinking their position! In late December the Danish government’s press office notified us that the intended tax on printed ads is being reconsidered.
The Danish parliament was due to vote this month on legislation that would impose a tax on printed advertising, increasing its cost by up to 50%. The Danish Printers’ Association has worked extremely hard over many months to encourage Danish lawmakers to look more carefully at print’s sustainability and at the knock-on effects of a such a punitive tax. They have explained that print is not damaging to the environment and that the proposed legislation is based on poor environmental science. Consequently Benny Engelbracht, the Danish Minister for Taxation, has invited members of Denmark’s two leading political parties to a renewed discussion. Mr Engelbracht said that “When I hear signals of reservations from the other parties, I of course take this seriously. So I think it’s only natural to invite [them] to new talks. But I have to stress that if this tax is to be abandoned we need to find other ways to finance this.” He is referring to the fact that the tax was intended to pay for the Danish “green check” tax refund. This is: “a deduction of your tax payment … as a compensation for new “green” taxes. In 2015 it is 955 DKK a year per person [over 18]”, according to the Danish government press office.
The government’s stated goal was to tax print on the basis that it is bad for the environment. The vote has been delayed until March to give the politicians more time to understand the economic and social implications of the proposed tax and to think of how to replace it. Extending the window for debate is an opportunity for a more nuanced consideration. It is a basis for closer dialogue between the Danish government and the Danish Printers’ Association and other interested parties. The extension gives politicians the chance to understand print’s sustainability, associated environmental impact data and the importance of waste and resource management at local level. Taxing print also fails to consider the opportunity cost of restricted media options to businesses and wider society.
This whole business has been about money, but that might also be why the tax is being reconsidered. When the proposal was initiated in 2012, anticipated revenues were DKK340 million per year, roughly $57 million. But according to the Danish government press office “The tax minister's calculations show that the expected revenue will be a third less than expected in 2012.”. The Danish printers’ association estimates that the tax would result in the loss of 600 print and supply chain jobs. The cost in unemployment benefits, which in Denmark are generous and so expensive for taxpayers, would be high. Maybe Mr Engelbracht reckons there are other less costly and less damaging ways of finding $57 million? Let’s hope so.
- Laurel Brunner