Private artisans exempt from taxes and VAT

Parliament will tomorrow approve finance minister Jørgen Niclasen’s proposal to exempt private artisans and craftspeople from taxes and VAT on sales income below DKK 50,000 per year.

A majority of the Parliament’s finance committee, represented by the government, supports the proposal, arguing that private home industry is rooted in old Faroese tradition and is an integral part of Faroese culture.

Another reason for helping the home industry, according to the committee majority, is that a large portion of these products are sold to tourists, thus contributing directly to the tourism industry revenues.

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Faroese home industry primarily features clothing products made from wool, but in recent years there has been an increase in products made out of wood, stone, animal horns, etc.

Finance minister Jørgen Niclasen says that tax complications are a constant obstacle for private artisans, and that relaxing the rules in this area would be a great relief for these people.

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However, the opposition members of the finance committee are not keen on the proposal, arguing that since the financial crisis in the 1990s, there has been broad political agreement on moving away from introducing tax exemptions for selected groups and instead adopting a more generalised system in which everyone pays equal amounts of tax.

The opposition points out that the government has introduced numerous tax exemptions in recent months and is trying to buy political support from selected groups by undermining the existing tax system.

Translated by prosa.fo