Sweden slashed its food VAT from 12 to 6 percent on April 1st, and Danes are already flooding across the Øresund Bridge to save money. With Denmark maintaining Europe’s second highest food prices and a flat 25 percent VAT on everything, Danish grocery stores and jobs are now under serious pressure from Swedish competition.
I watched it happen in real time at the Ica supermarket in Malmö’s Emporia shopping center. Hanne Pitters stood at the gluten-free shelf, doing the math out loud. A pack of crispbread costs 26 Swedish kronor here. The same pack in Denmark? 54 or 55 kroner. Less than half the price.
She and two friends had driven over from Denmark, their trunk already packed with gluten-free goods from another Swedish store. They arrived a day early. Had they waited until April 1st, when Sweden’s food VAT dropped to 6 percent, they would have saved even more. When I told them about the timing, Kirsten Larsen, one of the friends, laughed. They’d come too soon.
This is not an isolated trip. This is a pattern. And it’s about to get worse for Danish retailers.
Denmark Stands Alone on VAT
Denmark charges 25 percent VAT on all goods. No exceptions. It’s the only country in the EU without differentiated VAT rates. Every other member state applies lower rates to essentials like food, letting families afford the basics without getting hammered by taxes.
Germany charges 7 percent VAT on food. Norway charges 15 percent. Poland charges 5 percent. Sweden charged 12 percent until yesterday. Now it’s 6 percent, and that’s a 5.35 percent price drop across the board on groceries.
The result is predictable. Denmark has the second most expensive food prices in the EU. Danes pay 19 percent more for groceries than the EU average. Swedes now pay about 10 percent less than Danes overall, with sharper gaps on specific categories. Dairy products are 13 percent cheaper in Sweden. Bread and grain products are 20 percent cheaper. Tobacco is 16 percent cheaper.
Jens Esbjørnsson, the assistant manager at Ica Emporia, sees the Danish shopping carts every weekend. They’re fuller than the Swedish ones. Candy, chocolate, gluten-free products, cheese, cigarettes. On weekends and Danish holidays, about one in three customers is Danish. He expects more now.
The Cross Border Run
Ica isn’t the only magnet. Between Emporia and the bridge sits a Circle K gas station, and it’s packed with Danish license plates. Gasoline costs 18.44 Swedish kronor per liter there, which converts to 12.69 Danish kroner. That’s exactly three kroner cheaper than Circle K stations in Denmark, which were selling the same fuel for 15.69 kroner.
Linn Tran filled up her tank while I was there. She saves nearly 150 kroner on a full tank. Sweden plans to cut fuel taxes further on May 1st, dropping rates to the EU minimum. That’s another Swedish krona saved per liter.
The pattern is clear. Danes drive across the bridge, fill the car with cheap gas, load up on groceries, maybe grab lunch and shop for clothes at Emporia, then head home. It’s a day trip that saves hundreds of kroner.
What This Means for Danish Jobs
Claus Bøgelund Nielsen, vice director at De Samvirkende Købmænd, which represents Danish grocers, watched Sweden’s VAT cut with concern. When Danes shop in Sweden, Denmark loses the VAT revenue and the excise taxes on those goods. That means less money for the treasury. It also means fewer jobs and less economic activity at home.
He argues Denmark should follow suit and lower food VAT. The rest of Europe does it because it makes essentials affordable. Recent years have been expensive for Danish consumers, and politicians need to act. Sweden is now at 6 percent. Germany is at 7 percent. Denmark is stuck at 25 percent.
I’ve covered Danish policy long enough to know the government won’t move quickly on this. The finance ministry loves that flat 25 percent rate. It’s simple. It’s predictable. It brings in massive revenue. Differentiating VAT means picking winners and losers, managing exemptions, dealing with EU rules on what qualifies for lower rates. It’s politically messy.
But the Swedish VAT cut isn’t happening in a vacuum. It comes as Øresund migration patterns shift. In 2024, 3,590 people moved across the bridge, up 6 percent from 2023. More Swedes are moving to eastern Denmark than the other way around now, but the economic pressure that drives Danes to shop in Sweden is the same pressure that drove thousands to move there over the past decade. Lower housing costs. Lower living expenses. Lower taxes on essentials.
The number of Danes living in Skåne actually fell by 1 percent in 2025 compared to 2024, breaking a long upward trend. Maybe some are moving back. Maybe Danish housing prices are stabilizing. But 19,305 Danes still live in Skåne, compared to 11,731 Swedes living in eastern Denmark. The balance is narrowing, but Denmark is still bleeding residents to cheaper Swedish alternatives.
A Policy Choice, Not Fate
This isn’t fate. It’s a choice. Denmark chose to maintain a 25 percent flat VAT while every other EU country carved out lower rates for food. Sweden chose to cut its food VAT in half. Those are political decisions with real consequences for where people live, where they shop, and which countries collect the tax revenue.
Danish grocery stores near the bridge will feel this first. Retailers in Copenhagen will feel it next as the savings justify longer drives. Jobs in the Danish food retail sector are at risk if the trend accelerates. And it will accelerate, because a 5.35 percent price drop on top of already cheaper Swedish groceries is not marginal. It’s substantial.
I don’t think Denmark will lower its food VAT this year. Maybe not next year either. But Sweden just forced the issue onto the table. The question is no longer whether differentiated VAT makes theoretical sense. The question is how many jobs Denmark is willing to lose before it acts.
Sources and References
The Danish Dream: Danish food prices under pressure as Sweden cuts food VAT
The Danish Dream: Why are Danish grocery prices rising fast?
The Danish Dream: More Danes shop abroad as grocery prices climb at home
The Danish Dream: Buying property in Denmark for foreigners
TV2: Da
