Denmark's 2027 Finance Bill: Changes to housing assistance, pensions, taxes and border controls

A leaked version of Denmark’s 2027 Finance Bill has revealed a range of measures that could affect the income of some families, including a proposed change to the conditions for obtaining housing assistance, stricter conditions for Seniorpension pensions, increases in some pensions, a reduction in corporate tax, and the imposition of new fees on cruise ships, according to TV2.

Housing assistance: New limit for new applicants

The government wants to introduce a liquid assets limit for first-time applicants for housing assistance (Boligstøtte), the state-provided benefit that helps pay part of the rent for eligible individuals. Read more after the announcement.

According to the proposal, a new applicant will not receive housing assistance if they have liquid assets exceeding 500,000 kroner.

Liquid wealth, simply put, refers to funds and assets that can be easily converted into cash, such as money in bank accounts, certain investments, and securities. This does not automatically include the value of a person's home, car, or personal belongings; the method of calculating wealth varies depending on the type of asset and the Boligstøtte rules.

According to the leaked documents, the proposed condition would apply to new applicants, and not to all people who currently receive housing assistance.

The government expects the measure to save the state treasury around 90 million kroner in 2027, with savings gradually increasing to around 840 million kroner in 2030.

Tightening the conditions of Seniorpension

The government is also proposing to tighten the conditions for obtaining Seniorpension, which is a pension different from Folkepension, i.e., the regular government retirement pension that a person receives upon reaching retirement age.

Seniorpension is allocated to people who are nearing retirement age and whose ability to work has become permanently limited due to their health condition.

The current rules stipulate an assessment of a person’s ability to work in their last job, with the requirement that their ability to work be as low as 15 hours per week or less, in addition to other conditions related to age and connection to the labor market.

The proposed change stipulates that the applicant's ability to work in all types of jobs, not just in their most recent job, should be assessed.

Therefore, if a person becomes unable to continue in their profession due to their health condition, but is able to do other, lighter work, this may affect their right to receive Seniorpension under the proposed system.

TV2 reports that the government expects the tightening to save around 200 million kroner in the first year, with the value of the savings increasing until 2030.

Criticism from unions

The proposal drew criticism from several unions and professional organizations. Dorthe Boe Danborg, president of the Danish Nurses Association Dansk Sygeplejeråd, said the change could be particularly harmful to nurses who are exhausted from working for many years in the profession, according to the source.

The Akademikerne organization also criticized the proposal, with its president, Thomas Keppler, saying that the most exhausted people should not have to bear the cost of further political reforms.

The BUPL union, which represents education workers, also criticized the change, arguing that physically and mentally exhausted workers need a safety net at the end of their careers.

In contrast, Dansk Industri supported the principle of assessing a person's ability to work in the labor market more broadly, but at the same time criticized the increase in the "Arne" pension, considering that the labor shortage makes it important to encourage older people who are able to work to continue in the labor market, according to the source.

Increase in Arne's pension and government retirement pension

In contrast, the government is proposing to increase the value of the Tidlig pension, popularly known as the "Arne pension," by 3,095 kronor per month starting from January 1st.

It also proposes raising the Folkepension, i.e. the regular state pension, by 1,600 kroner before taxes for lower-income pensioners, and it is expected that around 150,000 pensioners will benefit from the increase.

Arne's pension differs from Seniorpension; the former is mainly linked to age, number of years of work and connection to the labor market, while Seniorpension is linked to a decrease in the ability to work for health reasons.

Corporate tax reduction

According to the source, the government wants to reduce corporate tax by three percentage points starting in 2030, and according to the leaked draft, this reduction will cost the state treasury about 6.4 billion kroner.

New tax on cruise ships

The draft budget law proposes a new tax on cruise ships docking in Danish ports. The tax will be 200 kroner per passenger starting in 2028, and the government expects it to generate around 300 million kroner annually for the state treasury.

100 million kroner to strengthen security at Copenhagen Airport

The government has allocated 100 million kroner to strengthen border controls at Copenhagen's Kastrup Airport. This comes after problems with long queues that frustrated travelers, and with the airport's planned expansion, the government wants to provide more staff and improve security procedures.

Further savings in ministries

The plan also includes increasing savings within ministries and government administration, with the government aiming to save 100 million kroner in 2028, 200 million in 2029, and then 500 million kroner in 2030, as part of reducing bureaucracy and management costs.

30 million kronor to combat wolf attacks

The Finance Project has also allocated 30 million kroner for next year to deal with the wolf problem. The funds include the construction of more secure fences, monitoring of wolves, and compensation for farmers who lose their animals due to wolf attacks.

500 million kroner for negotiations between the parties

The government has allocated 500 million kroner to what is known as the negotiating reserve, which is money that the parties in parliament will negotiate before the Finance Bill is finally adopted later in the autumn.

Therefore, the items contained in the leaked draft do not necessarily represent the final version of the finance law, as the government still needs to negotiate with parliamentary parties before adopting the final agreement for next year’s budget.