The Danish Tax Agency identified errors or fraud in 55 percent of its inspections targeting social dumping during the first half of 2024. This was revealed in a press release from the Ministry of Taxation, highlighting the agency's efforts to combat practices undermining fair labour conditions and tax compliance.
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Social dumping occurs when foreign workers are employed under poorer conditions or for lower wages than their Danish counterparts. Such practices are viewed as a threat to fair competition and compliant businesses in Denmark. Tax Minister Rasmus Stoklund stated: 'Social dumping is the exploitation of cheap foreign labour and undermines the competitiveness of compliant Danish companies. Therefore, social dumping must be combated with full force.'
From January to June 2024, the agency issued tax and VAT collection notices amounting to DKK 266 million following inspections. Since the government's crackdown began in 2019, these efforts have recovered a total of DKK 2.1 billion.
The Danish Tax Agency works in collaboration with the police and the Danish Working Environment Authority to identify and address cases of social dumping. Inspections focus on industries with the highest risk, such as construction, services, and the green sector, where previous experience has shown a higher prevalence of irregularities. The authorities also conduct nationwide inspections to ensure compliance across Denmark.
In 2023, over 3,300 inspections were carried out, uncovering errors or fraud in more than 1,900 cases. During the first half of 2024, approximately 1,700 inspections were conducted, continuing the agency's intensive efforts.
When irregularities are discovered, companies or employees are required to settle unpaid tax and VAT. The joint effort reflects the government's commitment to tackling tax fraud and promoting equitable working conditions.
Source: www.wood-supply.dk