Confronting SKAT in the Højesteret: An investigation into how EU Law, Precedent, Litigant Resources, and Structural Reform shape Tax Decisions

In recent years, a debate has emerged about the overwhelming success rate of SKAT (the tax authority) in cases before the Højesteret. Why does the Danish government win so many cases before the Højesteret, and what circumstances might increase a private litigant’s chances of winning? In this paper, we explore a variety of trends in judicial behavior for tax cases in the Højesteret. We find that while we cannot rule out some connections between judges’ social backgrounds and their votes, the primary factors influencing judicial behavior in tax cases are institutional and legal in nature. In particular, we show that corporations and associations achieve more wins in the Højesteret compared to individual citizens. In addition, inertia created by the large amount of government wins in the Landsretten also influences decisions. Finally, taxpayers have a slightly better chance of attracting favorable votes from justices in cases involving EU issues.