Danish Prime Minister threatens election campaign by taxing the rich.

Mette Frederiksen has used her electoral recovery since the Greenland crisis to advance in an election where the left threatens to defeat the Social Democrats.

Danish PM shakes up election campaign with tax on rich

In the first days of the campaign for the general elections in Denmark, which will take place on March 24, there is no mention of the increase in defense spending or the strained relations between the Scandinavian country and the United States.Not about immigration, not the increase in the cost of living.The leader of the Social-Democrats, Matt Fredriksen, wants to strengthen his position as Prime Minister, by putting the re-introduction of the tax on the wealth of the richest as the main issue of the vote, with the aim of reducing inequality.

Frederiksen was supposed to call an election by the end of October this year, but he used a surge in popularity in the polls due to the crisis with Greenland to move the election to the end of March.

During the legislative period, the social democratic leader was accused of carrying out too right-wing policies at the head of a coalition government with the liberal party and the moderates.Polls show that it is now the green left that threatens his party's victory: the Socialist People's Party is growing after Copenhagen's city government was ousted by the Social Democrats in local elections in November.

Faced with a growing left-wing trend in the election, Frederiksen delivered a campaign coup by announcing that if his party wins, he intends to impose a 5% tax on assets exceeding 25 million Danish crowns (2.3 million euros).This proposal did not bring consensus either in the current coalition or among the conservative parties, and it also clearly angered the Danish business community, with many wealthy businessmen threatening to move abroad.

A tax to fund school reform

From the stage of parliament, Frederiksen justified the need to restore this tax, which was already abolished in the Nordic country in 1997, saying that "when the richest 1% own almost a quarter of the total wealth of Danes, the situation is already very unequal."

In this speech, the Socialist leader cited a report published by the progressive think tank Business Council of the Labor Movement (AE, for short in Danish) which shows that the wealth of the richest 1% of Danes will increase by 31% between 2020 and 2024, while the average wealth of the rest of the population will increase by only 3.3%.The AE report indicates that the average 1% of Danes have a wealth of 58 million kroner (7.7 million euros), compared to the median wealth of Danes, which is 930,000 kroner (124,000 euros).

In an interview with the economic newspaper Børsen, Frederiksen stated that the new tax would affect 22,000 people, who would pay an average of 300,000 crowns per year (40,000 euros), while the state would collect about 6 billion crowns (803 million euros).

The Social Democrats said they would use the proceeds to fund school reform, their second star bid to win the election.The Prime Minister has pledged to reduce the number of students in public schools to 14 students per class in the first years of primary education, which, according to experts, is an overly ambitious measure, as it means a significant increase in the state budget for education.

Flying fear of great fortunes

As expected for the Social Democrats, the return of the wealth tax in Denmark has angered the big business, and they have expressed their opinion with strange words in the media.On the other hand, according to a survey conducted in February by Oxfam Denmark, almost half of the voters see the tax as a good solution to fight inequality.

One of the figures who has strongly opposed the tax for the rich is the CEO of the company Vestas, the world leader in gas production PLTMH, which represents the true economic engine for the Nordic countries.In an interview for the newspaper Berlingske, director Henrik Andersen threatened to leave the country and move part of his company: "If it is true, I will dedicate a part of my time to know where I want to be, I cannot say more clearly.

Robert Maersk Uggla, CEO and member of Denmark's most powerful business family, owner of A.P.Møller-Maersk, one of the world's largest shipping companies, has also joined the campaign.Uggla stated that the tax would be "damaging for Denmark" and that his company would, among other things, have even more difficulty recruiting and retaining its top managers, since Denmark already has the highest tax among the countries in the Organization for Economic Co-operation and Development.it has one of the biggest burdens, because it has taxes equivalent to 45.2% of GDP, according to the organization.

One example of the most alarmed businessmen these days is the case of Norway, where the wealth tax was also one of the decisive issues that led to the restoration of the Labor Party to power.There, in 2022, the government approved a tax increase of 1% from 145,000 euros and 1.1% above 1.76 million euros.The increase led to Norway's richest man, industrial magnate Kjell Inge Røkke, surprise announcing that he would live in the Swiss city of Lugano to avoid paying the increase.

Since then, Norwegians have seen a huge influx of wealth, mostly leaving the country to settle in Switzerland.According to a list compiled annually by Capital magazine, 105 of the 400 richest moved abroad between 2022 and 2024, which left-wing parties saw as a real "shame". It has become expensive, as a 37.8% tax is currently applied to capital gains above three million NOK (253,000 euros).