Norway salmon firms face ‘hostile’ 40 per cent tax
NORWAY’S fish farming companies face the unpalatable prospect of a new 40 per cent basic tax rate on their profits.
That is the main majority recommendation from the special committee chaired by economics professor Karen Helene Ulltveit-Moe as she presented her plans this morning.
The decision of the committee, which was set up last year to examine new tax proposals for aquaculture, has not gone down well with the industry, which said it will decimate future investment plans. Ulltveit-Moe described it is as a 40 per cent natural resources tax based on profits and the rate is in line with what was imposed on the power and hydrocarbon industry recently.
The committee also proposed eliminating the property tax on fish farming facilities. If implemented, the new tax would give the government revenues of around seven billion kroner, or £600 million, a year.
However, the committee was divided on its proposals and there is speculation as to whether a Conservative led coalition government is likely to implement the full recommendations that have been described as Marxist. Professor Ulltveit-Moe told this morning’s presentation: ‘The aquaculture industry is spending money on the community’s natural resources, and then the community must also get something back.’
Six of the nine members on the committee have voted in favour of the proposal. The Norwegian seafood website ilaks.no said the recommendation ‘oozes Marxism’. Speaking on behalf of the some of the seafood companies, spokesman Robert Eriksson said that if the plan went through, then aquaculture would be burdened by a special tax, adding that many rural districts would be hit hard.
‘This is hostile politics for the districts and will effectively cut off the branches that make up the aquaculture tree,’ he added.
While industry headlines are often dominated by large international names, such as Mowi and Grieg, most of the 174 salmon companies that make up the industry in Norway are small or medium sized.
So far there is no specific mention of the Aquaculture Fund which supports rural communities, but Seafood Norway CEO Geir Ove Ystmark fears it could spell the end of the scheme.
This year, the fund will dsitribute 458 kroner (almost £40 million) to more than 100 fish farming communities.