A sudden sin-tax increase has sparked protests in Nuuk
Demonstrators say decision reveals government out of touch with public.
Protesters in Nuuk and Copenhagen have called for Greenland’s government, Naalakkersuisut, to step down over sudden increases in excises taxes on a wide range of items — a call that Naalakkersuisut members have refused. The new taxes are intended to stave off a budget shortfall next year.
An estimated thousand people chanting “naammaleqaaq!” (“enough is enough!”) turned out in Nuuk (population 15,000) for the second Wednesday running last week to protest the increases on items ranging from sugar and alcohol to plastic bags and snowmobiles. The most recent demonstration was joined by 50 people from Greenland living in Denmark who had gathered in Copenhagen to express their dissatisfaction with the government.
The increases, announced on November 18, were passed by Inatsisartut, the national assembly, on November 21 and went into effect the following day. They are expected to generate 182 million kroner ($27 million) in revenue over the next four years — about the same amount that will be spent on primary education during that same period — on top the 150 million kroner sin taxes already take in.
Naalakkersuisut defends the increase, arguing that the higher prices will contribute to improved public health in the form of decreased consumption of unhealthy food and alcohol, as well as help reduce the number of smokers, estimated to be half of the adult population.
“These taxes are painful, but you have to consider what’s being taxed,” said Vittus Qujaukitsoq, the finance minister, during presentation of the budget. “I think you should consider the size of the impact it will have on our health, and that this will allow us to think about how we can improve our lifestyle.”
Sin taxes, according to Premier Kim Kielsen, were the fairest way for his government to address the public health issues connected to lifestyle.
“We could have raised income taxes or done something else,” Kielsen told KNR, Greenland’s national broadcaster. “But the solution we chose was to make luxury items, like cigarettes, alcohol and sugar, more expensive.”
The government admitted, however, that the government needs the income that the taxes generate to help balance a budget that also includes a reduction of the corporate tax rate and an increase in a personal deduction.
Legislators who backed the corporate tax cuts described the 162 million kroner measure as an effective way to stimulate the country’s economy.
The organizers of the demonstration said they were seeking to marshal people’s anger with the sudden tax hikes to draw attention to a government they feel is out of touch with voters.
“We are here demonstrating to let it be known that we want to be heard and be involved. In a democracy, you involve voters and listen to those you don’t agree with,” Avaaraq Olsen, one of the organisers, said during the demonstration, according to local media.
During the demonstration, Olsen handed Kielsen a petition signed by 1,300 of Greenland’s 56,000 residents, stating they were dissatisfied with the government’s priorities.
Striking a defiant tone, the premier cautioned against expecting the signatures would have any effect.
“You need to remember that we held a democratic election. And a majority of those who were elected back the work of Naalakkersuisut.”