Oslo Cracks Down on Tax Breaks for Energy Companies
Norway's Prime Minister says his government will raise taxes on hydrocarbon extractors, in a new range of measures seen as strategies for an election win in September.
Jens Stoltenberg presented plans for a modest tax cut for some indigenous businesses, while increasing taxes on oil companies and multinationals.
In what is tagged a "growth package" for Norwegian business, the government says it wants to overcome uneven development among different sectors of the national economy.
A new tax amendment provides for oil and gas companies to bear a larger share of investment costs, as tax relief will be less generous. Energy majors will also have to pay a larger share of cost overruns on projects.
The tax hike for the oil sector will average around NOK3 billion (€398 million) per year until 2050, while the corporate tax cut will lower revenues by about 3 billion, the Prime Minister said.
Extraction of oil and gas from the North Sea accounts for one-fifth of Norway's gross domestic product (GDP). Energy major Statoil is two-thirds owned by the government.
Statoil's chief financial officer, Torgrim Reigan, said the tax proposals raised serious questions about the future of offshore Norway.
"The proposed change in the Norwegian petroleum tax reduces the attractiveness of future projects, particularly marginal fields and raises questions regarding the predictability and stability of the fiscal framework for long-term investments on the Norwegian continental shelf," he said in a statement.
As well as the corporate tax cut, Oslo will close a tax loophole "to avoid multinational corporations shifting taxable profit from Norway to low tax countries", the government says.
The new tax package will be part of the national Budget, due to be brought down in parliament Tuesday.
Norway will have national elections in September. Polls indicate Stoltenberg's Labour party would be easily defeated by the centre-right opposition after eight years in office.
See also: Norway Postpones Gas Tariff Reduction