- I don't know whether to close or develop my business

When the National Assembly goes to the second reading of the bill on a new special tax on businesses, which has been much criticized by the business community, Director Kitdlak Knudsen from Carl Lynge ApS in Nuuk is sitting with a knot in his stomach.

For Kitdlak Knudsen, this is not a matter of ordinary political interest – but of a decision that could determine the future of his life's work.

- I am nervous about the political decision, because it will determine whether my business will be closed down or developed, says the 53-year-old electrical installer.

A year of stagnation

The uncertainty has already had noticeable consequences. According to Kitdlak Knudsen, his company has been practically idle for over a year, while he has been waiting for clarity from Naalakkersuisut and Inatsisartut.

– We have been stuck for over a year. I have not been able to make the decisions needed to develop the company. It has been a great personal burden for me, he says.

Carl Lynge ApS currently employs nine employees and two apprentices and has its headquarters in Nuuk and activities on the coast. The company has been built up over more than two decades. But the future is now uncertain.

Embarrassing to investors

Last week, Kitdlak Knudsen was visited by a potential investor and co-owner. The meeting, which should have been about growth and opportunities, was instead marked by uncertainty.

– It is almost embarrassing to sit across from a potential investor and not be able to answer what the framework conditions are for doing business in Greenland. I simply cannot give a clear answer, says Kitdlak Knudsen.

The bill on the special tax was submitted by the then Minister of Finance and Taxes, Múte Bourup Egede, IA.

It is precisely the uncertainty about the upcoming special tax – also called an exit tax – that makes it difficult to attract investors from outside. The bill proposes that companies may be taxed on their equity if their ownership or management is linked to Denmark and abroad.

Risk of liquidation

For Kitdlak Knudsen, the consequence is clear: If the law is adopted in its current form, it may become impossible to get new co-owners into the company.

– Then I am left with the choice between continuing alone or starting a liquidation. And that is not a sustainable situation in the long term, he says.

He points out that precisely the supply of new skills and capital is crucial for developing small and medium-sized businesses in Greenland.

– If we cannot get investors in, we risk that businesses will close instead of grow. It doesn't just affect us, the owners – it affects employees, apprentices and the entire local community, Kitdlak Knudsen states.

A crucial week for business

The consideration of the proposal will therefore be crucial, not only for Kitdlak Knudsen, but for a broad part of the Greenlandic business community, which is following Inatsisartut's consideration of the bill closely.

I hope the politicians understand what the consequences are in practice. For us, it is not about theory. It is about jobs, investments and the future of local companies, says electrician Kitdlak Knudsen. According to the plan, the proposal will be secondly considered in Inatsisartut on May 20.