Norwegian parliament passes new aquaculture tax
May 31, 2023 By Nestor Arellano
Following eight months of debate over a controversial tax on salmon and trout farmers, Norway’s parliament passed a bill on May 31 mandating an additional resource rent tax on aquaculture with a tax rate of 25 per cent.
Norwegian fish farming company, SalMar, warned the new tax “will will affect the entire value chain, especially the land-based industry and suppliers.”
The Storting, Norway’s supreme legislature, announce in September, 2022 a proposed 40 per cent tax on aquaculture companies. The expected revenue from the proposed tax will be NOK 3.65 billion (US$347 million) and NOK 3.8 billion (US$361.2 million). A key element of the proposal is that the local communities which make natural resources available should be guaranteed a share of the resource rent.
In March 2023, the parliament announced an update proposal of a 35 per cent tax. This came about after the parliament received feedback during the consultation period. About two months later the Labor Party (AP), The Center Party (SP), the Liberal Party (Venstre) and the minor political party Patient Focus agree on the final proposal of 25 per cent. The minimum threshold when firms will start to pay taxes in NOK 70 million (US$6.3 million). The new tax will apply retroactively from January 1, 2023.
“This is in addition to the regular corporate tax and means that the marginal tax rate on aquaculture will increase by over 100 per cent, from 22 per cent to 47 per cent,” SalMar said in a statement from said.
The company said the new tax is “is being implemented without the involvement of stakeholders and broad political consensus that traditionally characterize major changes in the tax system and framework for Norwegian businesses.”
SalMar contends that the new tax is based on the “incorrect assumption that aquaculture food production is a location-bound resource rent industry that consistently generates extraordinary returns disproportionate to the risk involved.”
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