Denmark’s pensions lobby group said today it has asked the Parliamentary Ombudsman to intervene because the Tax Agency (Skattestyrelsen) has been wrongly charging pension firms VAT on management services nine years after a key court ruling.
Insurance & Pension Denmark (IPD) referred to a 2014 ruling by the European Court of Justice (ECJ) in favour of Danish pension fund ATP when it argued occupational defined contribution (DC) management costs should be exempt from VAT charges.
The ECJ then ruled that DC schemes, under certain conditions, could be classed as special investment funds (SIFs), thus exempting the management costs from VAT.
Kent Damsgaard, IPD’s chief executive officer, said: “Danish pension companies and their customers are still waiting to be repaid DKK3.5bn (€470m) as a consequence of the judgment, but nothing has happened.
“It is completely unacceptable, and that is why we have now called on the ombudsman to look into the matter,” he said.
IPD said three pension companies had entered into settlements with the state in 2015, but the rest of the sector was still waiting for repayment.
IPD said the Tax Agency still needed to come up with a concrete clarification on which services were exempt from VAT.
“The pension companies still cannot get a clear answer from the Tax Agency on what the VAT exemption covers, so the industry is also prevented from proceeding to the courts – simply because the Tax Agency during this period has failed to make decisions that could then be brought before the courts,” he said.
IPE has contacted the Tax Agency for comment on the matter.