Gentofte Municipality is among the richest in the country, and therefore there are also a number of estates of considerable value, which for that reason triggers significant taxation.
The municipality has first in the high court and then in the Supreme Court demanded 16.4 million kroner from the state, which the municipality believes it is entitled to. The amount comes from taxes from 71 estates.
In December, the Eastern High Court said no to the municipality, and on Wednesday the Supreme Court upheld the verdict. The decision was made by seven unanimous Supreme Court justices.
But in the terms of the judgment, the judges write a remarkable sentence:
– The Supreme Court notes that it must be a legislative matter to decide whether to change on the basis on which a municipality’s share of estate and interim tax is to be calculated.
When the Folketing implemented the local government reform in 2006, in which the counties were abolished, the Estate Tax Act was also amended. It stipulated that the municipalities should have the right to a third, while the rest should go to the state.
In order for a municipality to be able to claim its third, the necessary information for calculating the property tax must be available no later than 1 May in the second year after the year of death, the law states.
However, with the change in the law in 2006, some provisions on so-called post-adjustments were abolished. This means that only if the information in question is registered in the so-called “final tax system”, can the municipality get its money.
In other words, it is not enough that the municipality has submitted the tax return to the tax authorities. A person must also enter the information in the final tax system before it is “available” within the meaning of the law.
It is precisely the interpretation of the word “present” that the Supreme Court has dealt with. And the conclusion is that the information is only “available” when it is entered.
The Supreme Court notes in the judgment that this consequence in the amendment of the law from 2006 is not dealt with in the comments on the bill that government officials always prepare when new laws are made.
The comments on the law are a very central source for how the wording of a law should be interpreted, but in this case there is no help to be found for the seven Supreme Court judges.
Therefore, it will require new legislative work if the municipalities are to be entitled to their share on the same terms as they had before the change in the law.
Source: The Nordic Page
