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May 15th, 2013

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Former top Tax Ministry official Peter Loft testified in front of the Taxgate commission in Gladsaxe yesterday that former tax minister, Troels Lund Poulsen (Venstre), asked several times if the tax case against PM Helle Thorning-Schmidt (Socialdemokraterne) and her husband, Stephen Kinnock, could be reopened after an audit by tax authority Skat Copenhagen ruled that Kinnock, a British national who worked in Switzerland at the time, did not owe Danish taxes.

Loft testified that during a meeting on 16 September 2010, Poulsen asked several times if there was a way that the ruling could be reversed and asked ministry employees to investigate the possible avenues.

The Tax Ministry is prohibited by law from getting involved in individual cases.

Loft’s testimony directly contradicted Poulsen’s earlier assertions that he had not been involved, or even much interested, in the case.  

"I regularly briefed the minister concerning what the tax authorities had found,” Loft told the commission. “Whenever he had time, I went in and told him what we had found.”

Loft said that the briefings were all oral and done in confidence. He added that Poulsen’s interest in the case grew over time, particularly in the autumn of 2010 after Skat Copenhagen ruled that Kinnock was not liable for Danish taxes.

"The questions started coming in his office, in side rooms, in the cafeteria, over coffee,” Loft told Taxgate commission lawyer Lars Kjeldsen.

Loft said that he had repeatedly told Poulsen that there was no case, even when Poulsen suggested at the September 2010 meeting that Kinnock might be taxable because the family in 1997 had purchased a home in Denmark three months after moving to Belgium, where Thorning-Schmidt was working at the time.

"It was an argument I had not seen coming," said Loft. “I explained to him that it would not hold water.”

Nevertheless, after the meeting, several of Loft’s employees investigated various scenarios, looking for a way to reopen the case.

"They were all dead ends, and afterwards I heard nothing from the minister," said Loft.

During her appearance before the commission, Skat Copenhagen’s tax director Lisbeth Rasmussen said that Skat officials felt that Poulsen had “asked a lot of questions” about the confidential audit. Rasmussen also said that Loft applied consistent pressure to the Skat officials working on the audit. After the audit ruled that Kinnock did not owe Danish taxes, Rasmussen said that Loft continued to express his doubt about the ruling.

“It seemed like [Loft] was getting pressure from somewhere because somebody wanted a different result,” Rasmussen said.

Loft's role in Taxgate ultimately cost him his job.