Danes vote, face choices on taxes,refugees,welfare

COPENHAGEN, Nov 13 (Reuters) Danes voted today in a tight election with the government holding out promises of tax cuts and tough immigration laws, while the opposition offered improved welfare and a more compassionate stance on refugees.

Prime Minister Anders Fogh Rasmussen called the early poll last month, banking on his economic record and a crackdown on asylum-seekers securing a third term for his centre-right coalition ahead of tough public sector wage talks.

Rasmussen, 54, has been virtually neck-and-neck for most of the campaign with Social Democrat leader Helle Thorning-Schmidt, 40. But two polls published on Tuesday showed the pendulum now swinging back in his favour.

''I think there's a fair chance but I don't take anything for granted,'' he told Reuters late yesterday as he grabbed a traditional pre-election kebab on one of Copenhagen's popular pedestrian streets.

Across Denmark, where turnout is traditionally very high, voters turned out in chilly drizzle to cast their ballots.

''I think it can be the present government, but it's only a matter of a few votes. We are very divided,'' said Soren Lund, 52, a university teacher voting in central Copenhagen.

Thorning-Schmidt, leader of the four-party opposition, has argued throughout her campaign that it is impossible to have both lower tax cuts and better welfare services.

Polster Megafon said that about 10 per cent of Denmark's 4,000,000 voters were still undecided yesterday.

If Rasmussen prevails, polls show he may need the support of two disparate groups -- the anti-immigrant Danish People's Party and a new centrist entity led by a Syrian-born Danish Muslim that backs better treatment for refugees.

Danes are now more concerned with the health of the welfare system than immigration, the hot topic of the 2005 vote. This shift may count against Rasmussen, who currently relies on the support of the far-right DPP to govern.

But the party that may determine the shape of the new government is Syrian-born Naser Khader's New Alliance, which wants better treatement for refugees along with lower income taxes.

A Vilstrup poll for daily Politiken published today said Rasmussen and his allies were set to win 87 out of the 179 seats in parliament -- short of the 90 seats needed for majority -- against 83 for the opposition, with New Alliance securing 5.

A Gallup poll for daily Berlingske showed Rasmussen's bloc at 93 seats and Thorning-Schmidt and Khader at 78 and 4 respectively.

Khader has said he will back Rasmussen as prime minister, but does not support the policies of the DPP and wants to its leader Pia Kjaersgaard, 60, to have less influence in the government.

Rasmussen swept to power in 2001 on pledges to cut taxes and curb the flow of refugees into the Nordic country. He won a second term in 2005 for promising more of the same.

This year, he has sought to disarm the charismatic Thorning-Schmidt in key areas where she could have challenged him in a campaign, withdrawing Danish ground troops from Iraq and softening his stance on asylum-seekers with children.

REUTERS SKB BD1535