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Reduction or exemption from Danish drinking water tax investigated under EU state aid rules

By  |  March 22, 2012

The European Commission has opened an investigation into a tax reduction or exemption on the protection of drinking water in the Danish farming sector. The Danish tax is payable by owners of public water supply systems, but if a user has a water-extraction permit for their own well, he would have a reduction or be fully exempt if the permit is for less than 6000 m³ a year. Most users in the farming sectors hold such permits for their wells. The Commission’s investigation is to determine whether the reduction or exemption is a form of state aid that violates EU rules–“it seems to be selective and not justified in terms of the logic of the Danish tax system. What is more, the aid seems at this stage to be difficult to justify in the light of the relevant competition rules.”

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    Full content: EC Press Release

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