Denmark’s governing party, the Moderates (Moderaterne), has proposed abolishing the country’s longstanding coffee tax, calling it an outdated burden on consumers. The tax dates back to 1930, when coffee was regarded as a luxury good. Today, however, coffee is a staple in Danish households, with an average Dane consuming 6.6 kilograms of coffee per year, making Denmark one of the most coffee-drinking countries in the world.
Reasons behind the proposal
According to Ammar Ali, tax spokesperson for the Moderates and deputy for Monika Rubin, “The coffee tax is an outdated levy on Danes’ everyday coffee, and we believe it should be abolished. Not least because global market prices for coffee have risen sharply since 2021.” Official data from Statistics Denmark (Danmarks Statistik) indicates that coffee prices have increased by several hundred percent since 2020.
The idea has also received support from industry. In late June, the Danish Coffee and Tea Association (Brancheforeningen for Kaffe og Te) issued a press release advocating for a similar measure, arguing that the current tax puts unnecessary pressure on consumers at a time of high international prices.
Fiscal impact on the state budget
Removing the tax would come at a cost. Estimates suggest that eliminating the coffee tax would reduce state revenues by approximately 300 million Danish kroner (approx. €40 million) annually. While the Moderates have yet to outline how this shortfall might be compensated, the party maintains that the relief for households justifies the move.
A reflection of Denmark’s coffee culture
The debate highlights Denmark’s deep-rooted coffee culture. With Danes ranking among the top coffee consumers globally, changes to the taxation of coffee are not just an economic issue but also touch on daily habits and cultural identity.
