TAXATION SYSTEM

In Greenland, the only direct taxes are income taxes as there are no wealth, property or inheritance taxes.

A person is taxable if a person has permanent residence in Greenland or has resided in the country for at least six months. There is joint taxation of spouses.

The taxable income includes the total annual income minus the standard deduction and special deductions. In addition, B income recipients get a B income deduction.

The deductions include interest expenses, subscriptions to trade unions, maintenance payments and the like. If these deductions exceed the standard deduction, the standard deduction is repealed. Finally, a personal allowance is also in effect.

The municipal tax is fixed by the individual municipalities. In areas outside the municipal division, no municipal tax is paid but a special national tax to be fixed by the parliament. Table 9 shows the tax rates of each of the municipalities.

Companies pay a corporate tax of 30 per cent. Limited companies and private limited companies also pay a dividend tax at a rate equivalent to the current municipal tax. Corporate and dividend taxes are divided between the government and the municipalities in relation to the levying rates.