Danish airlines operating solely within Denmark will be exempt from VAT rules in the future, with a proposal expected in the autumn for new regulations to take effect on January 1, 2025.
The Transport Minister stated that domestic flights should not be penalizsed, and the change aims to encourage more domestic flights.
The government’s goal is fair competition, as Danish carriers operating domestically face VAT rules while foreign companies on domestic routes in Denmark do not.
Zero VAT currently applies to Danish airlines only if foreign traffic makes up over 55pc of their operations.
The announcement followed the termination of scheduled flights by DAT, making AIS Airlines the sole operator on the Midtjyllands-Copenhagen route. AIS operates under Dutch tax rules and will not be affected by the new Danish legislation.
Capacity data shows that six airlines have domestic seat capacity in Denmark, including DAT, Sunclass Airlines, Alsie Express, and WorldTicket, with Norwegian Air Sweden AOC and SAS Scandinavian Airlines having the largest seat and frequency capacities.
