The debate post was published in the Danish newspaper Børsen by Mikkel Fruergaard, Group CEO.
In Denmark, we often face a challenge: the tendency to write off and suspect the wealthy.
But behind every non-inherited fortune is a unique story of significant risk-taking – a trait that is often overlooked.
At CVX Ventures, we see how entrepreneurs and investors dedicate themselves to supporting growth companies despite challenges and uncertainties. Their investment is a step towards a better future and an expression of belief in the potential of the ideas and people they support.
This risk-taking doesn’t come without a cost. Having to close their business after investing their soul in the project or losing their savings are realities that these entrepreneurs and investors face. These risk takers are at the heart of Denmark’s economic development.
Without them, we would see a decline in innovation and a stagnant economy, which would hamper Denmark’s competitiveness globally.
To encourage more risk-taking individuals, entrepreneurs and investors, policy measures are necessary.
Denmark has one of the world’s highest capital taxation rates, which can hamper investment. In addition, we have hopeless rules in relation to investments in unlisted shares, including the rules on stock taxation for more than seven investors in an SPV (ed. Special Purpose Vehicle. Investment syndicates that gather in a special purpose vehicle with more than 7 entities (investors) are hit by stock taxation. To avoid inventory taxation, investors are forced to set up multiple SPVs if more than 7 want to participate in the investment, which increases costs, hassle and puts more entities on the cap table of the company receiving investments). A reduction of the stock tax and a simplification of the rules will make it more attractive for individual investors to support growth companies.
Similarly, lowering corporate taxes will strengthen companies’ competitiveness and increase their ability to invest in development and growth.
These tax policies can play a crucial role in stimulating the economy and fostering a culture of innovation and risk-taking.
Denmark’s future prosperity and success will depend on our ability to value and promote risk-taking. Entrepreneurs and investors are key to this scenario. Let’s give them the framework they deserve.
Lowering the corporate tax rate will strengthen the competitiveness of companies.
