Denmark has adopted the EU parent subsidiary directive granting EU based parent and subsidiary limited companies relief from dividend withholding taxes. For royalties paid to countries with which Denmark has entered into a Double Taxation Agreement the withholding tax rate is often lower than the normal rate or zero. VAT is added to virtually all taxable deliveries of goods and services including imports. VAT is charged on imports from other EU countries applying the reverse input method. VAT charged on sales to customers is paid over to the tax authorities less VAT suffered on purchases from suppliers.
Exports are exempt from value added tax.
Many goods are also subject to a special duty, including for example automobiles, petrol, wine and tobacco. Enterprises engaged in oil exploration, extraction, transportation and related activities in Denmark, in Danish territorial waters and on the Danish continental shelf are subject to a special system of taxation. Real estate taxes Real estate taxes are levied on most real estate based on a public assessment of the value of the property. Although the assessments cover both land and building it is basically the land component, which is taxed. However, in certain major cities, including Copenhagen, commercial property building tax is not insignificant.