Denmark’s government presented its proposal for the 2027 finance bill on Friday, including plans to abolish the intermediate tax bracket and to cut SU student grants for more young people living with their parents.
The proposal was unveiled on October 9, 2026, and sets out the government’s spending and tax plans for next year. DR Nyheder, which read through the bill, reports that taxes, pensions and student grants are among its central points.
Several elements had already been described by the government in advance, and some appear in the government platform. The document is a proposal, not final law, and parts of it are still being updated.
Bottom tax up to 800,500 kroner, top tax of 15 percent above
According to DR, the government wants to abolish the intermediate tax bracket, known in Danish as mellemskatten. Bottom tax, bundskat, would then apply to income up to 800,500 kroner a year. A top tax, topskat, of 15 percent would apply to income above that level.
The proposal also includes a cut in corporate tax of three percentage points in 2030, as reported by DR. On transport, the government wants electric cars with a price tag above 366,000 kroner to become more expensive from 2027.
SU cuts reach parental incomes from about 420,000 kroner
The government said last week that it wanted to abolish SU for more students living at home whose parents earn more than 710,000 kroner a year before tax. The new proposal goes further. Per DR, the four-party government now also wants to cut SU for home-living students whose parents earn down to around 420,000 kroner annually.
DR Nyheder reported on October 8, 2026, that more young people than expected stand to have their SU reduced under the plan. The same bill sets aside 900 million kroner for the folkeskole in 2027. Of that, 500 million kroner goes to all public schools and 200 million kroner is targeted at the 100 schools performing worst in Danish and mathematics.
On pensions, the government wants to make it harder to qualify for seniorpension by assessing whether an applicant could do another type of job, not only their current one. The early-retirement benefit known as Arne-pension would rise by 3,095 kroner a month from January 1, 2027. A further 2.1 billion kroner is set aside to give around 150,000 pensioners an extra 1,000 kroner a month, although DR notes it is still unclear which pensioners are covered.
What the tax and SU changes would mean for foreign workers and students
Denmark taxes wage income through several layers, including municipal tax, bundskat and topskat, administered by Skattestyrelsen, the agency most residents know as SKAT. The intermediate bracket the government wants to remove sits between the bottom and top rates, so the proposal changes where each rate starts for everyone with a Danish CPR number and taxable income here. Anyone wanting to see how the brackets apply to their own pay can use a Danish tax calculator alongside the official figures from SKAT.
SU is the state education grant paid to students at Danish universities and other programs, and internationals can qualify under specific rules depending on nationality and work history. The proposed cuts described by DR target students who live at home, with the reduction tied to parental income, now reaching households from about 420,000 kroner a year. What is not yet known is the final shape of either measure, because the finance bill must still be negotiated in the Folketinget before any change to income taxes in Denmark or SU takes effect.
