Denmark's New Budget Proposes Student Grant Cuts, Tax Changes and Boosted Defence Spending

Denmark's centre-left coalition, comprising the Social Democrats, Moderates, Green Left and Social Liberals, unveiled a budget that relies on support from the Red-Green Alliance and The Alternative to maintain a parliamentary majority of 98 seats. The plan removes SU eligibility for students living at home whose parents earn more than 710,000 kroner, affecting roughly half of home-living students. It also ends the electric-car registration-fee exemption, making new EVs over 366,000 kroner costlier from 2027, and imposes stricter unemployment-benefit criteria for recent graduates, requiring substantial part-time work history.

A new cap on the rentefradrag will impact around 60,000 borrowers, primarily in Copenhagen and northern Zealand. The estimated 2.4 billion kroner saved will fund free dental care for adults, the abolition of the mellemskat income tax bracket, possible further tax cuts, extensive agricultural reforms, and a defence budget of 22 billion kroner in 2027 rising to about 40 billion kroner by 2030.