Denmark's government has reintroduced a package of tax measures that lapsed following the general election, including expanded employment tax credit for seniors, the abolition of VAT on books and the coffee tax, and a range of tax deductions and administrative reforms, with implementation planned from 2026 and 2027 subject to parliamentary approval.
The Danish government has reintroduced a series of tax measures that were originally included in the 2026 Finance Act but lapsed when the election was called. The proposals, which fall under the Ministry of Taxation and Growth, are intended to increase disposable income, encourage labour market participation and simplify parts of the tax system.
If approved, several of the measures will apply from the 2026 income year, while others are scheduled to take effect from 2027.
Senior tax relief
One of the main proposals is the expansion of the additional employment tax credit for seniors. Under the plan, eligible workers in the final five years before reaching the state pension age would receive annual tax relief of up to DKK 9,500.
The government said the measure is designed to encourage older workers to remain in employment for longer before retirement. The expanded employment tax credit is expected to apply from the 2026 income year.
VAT and indirect tax changes
The government has also reintroduced legislation to abolish VAT on books and eliminate the coffee tax. Both measures are expected to come into force from 2027, subject to parliamentary approval.
At the same time, the government has withdrawn its previous proposal to abolish the tax on chocolate and sugar confectionery. Instead, revenue from the tax will be retained to support future plans, including proposals to reduce VAT on food and remove VAT entirely on fruit and vegetables.
New tax deductions and family measures
The legislative package also revives the proposed exercise tax deduction, which is intended to compensate individuals participating in sports and exercise activities following EU court judgments requiring VAT to be applied to services such as group fitness classes.
In addition, the government plans to increase the standard deduction for childminders from the 2026 income year.
Other measures being reintroduced include:
- Equal treatment of siblings’ children with immediate family for inheritance tax purposes.
- An increase in compensation for volunteers.
- A tax deduction for exercise and music lessons.
- A tax deduction for salary expenses relating to software development from 2025.
- More flexible rules for the payment of registration duty in connection with the registration of the electricity grid and related infrastructure.
Legislative programme
The government said the reintroduced measures will be included in its updated legislative programme. Their implementation will depend on the adoption of the relevant bills by Parliament, with most income tax measures targeted for the 2026 income year and indirect tax changes, including the abolition of VAT on books and the coffee tax, expected to take effect from 2027.
This announcement was made on 19 June 2026.
