The head of Denmark’s PenSam has spoken out about huge sums of tax revenue he says are being lost to Denmark and other countries because of corporate tax haven use, saying the exit from the pandemic is the right time to solve the problem.
Torsten Fels, chief executive officer of the DKK155bn (€20.8bn) Danish labour-market pension fund, said in a column on the PenSam website: “So let’s use the coronavirus bill as leverage to take action against the tax haven problem, and multinationals’ use of aggressive technical tax tricks, such as the ‘double Irish’ and the ‘Dutch sandwich’.”
Denmark seemed to have come through the worst of the coronavirus pandemic, he said, with fears of a potential economic crisis now turning to cautious optimism.
But the “legacy” of the crisis would have to be settled soon, he said, and the considerable sums spent on aid packages and compensation schemes would have to be found somewhere.
“When the coronavirus bill has to be paid, PenSam has a proposal about where politicians would do well to pick up the first billions – the problem of tax havens and tax evasion,” he said in the column, which was also published on Danish news service Altinget.
The pension fund’s CEO said the amount lost from multinational companies transferring their profits to tax havens corresponded to the annual salaries of approximately 18,000 social and healthcare workers – the labour-market sector that constitutes PenSam’s membership.
Last week, Fels said, PenSam together with trade union FOA, the charity Oxfam IBIS and NGO Mellemfolkeligt Samvirke – part of ActionAid – and others, had called on Denmark’s Minister of Trade and Industry Simon Kollerup to maintain the government’s “ambitious” negotiating position in EU negotiations on open country-by-country reporting, which he said must ensure full transparency on companies’ tax payments.
Increased political focus was needed in order to banish the problem of tax havens and tax evasion, the CEO said.
Fels warned there was unhealthy competition between EU countries on corporation tax. “In Denmark, we have lowered corporation tax over a number of years, and it will be a race to the bottom if it continues,” he said.