The Norwegian Seafood Association (Sjømatbedriftene) is criticizing a proposal by Norway’s tax administration, saying it is singling out smaller, family-owned aquaculture companies.
Norway’s tax commission has proposed removing the valuation discount on Norway’s wealth tax, which is currently set at 75 percent. The 75 percent discount on the wealth tax was part of negotiations over the “resource rent tax” set in 2023, which places a 25 percent rate on salmon aquaculture operations that was modeled in part off of the tax rates faced by extractive industries in the country like fossil fuels.
Sjømatbedriftene is claiming that move will disproportionately affect family-owned aquaculture companies.
“The proposal in reality entails a tax-related destruction of Norwegian ownership in aquaculture,” Sjømatbedriftene CEO Robert Eriksson said.
Norway’s wealth tax is levied at 1 percent on assets above NOK 1.9 million (USD 192,739, EUR 169,478), a.k.a. someone with net assets of NOK 2.5 million (USD 253,000, EUR 223,000) would pay the wealth tax on NOK 600,000 (USD 61,000, EUR 54,000) of those assets. For very high net worth individuals, that number increases to 0.1 percent.
The valuation deduction of 75 percent means the tax is calculated at a lower rate for aquaculture operations.
However, a recent report by an expert commission would restructure how those taxes are applied, and the Norwegian Seafood Association claims that difference would be detrimental to smaller, family-owned companies.
“In isolation, it is a good move that the Commission proposes to lower the rates of wealth tax. It is something that the business community has been calling for for a long time,” Eriksson said. “The problem is that they are simultaneously removing the entire valuation discount, thereby greatly increasing the tax base. The result is that they are giving with one hand – and taking back with both hands for the very smallest companies.”
Sjømatbedriftene claims the move would in effect quadruple the wealth tax, which would be manageable for larger companies but ruinous for smaller ones.
“This is not a proposal that primarily affects the large listed players. It is the small and medium-sized, family-owned companies along the entire coast that are hit hardest,” Eriksson said. “They have large assets tied up in concessions and facilities, but limited access to liquid capital. The tax must be paid regardless. The result is that the owners have to take out more dividends or sell down.”
Eriksson said the new proposal would only weaken smaller companies and force consolidation, which would eventually result in just a few dominant companies if the tax proposal goes forward.
“The aquaculture industry is already subject to land rent tax and other special taxes. At the same time, sharply increasing property taxation is going in the wrong direction. The valuation discount must be continued,” he said. “The alternative is a policy that undermines investments, jobs, and value creation along the entire coast.”
