Norway proposes production tax on farmed salmon, trout

The introduction of a production tax on salmon, trout, and rainbow trout is set to be proposed by Norway’s government in its National Budget for 2021.

According to a statement on the Finance Ministry’s website, the tax rate suggested is NOK 0.40 (USD 0.04, EUR 0.03) per kilogram of fish produced. This is expected to generate around NOK 500 million (USD 49 million, EUR 45.4 million) annually, which will be split between local and regional governments from 2022 onwards.

Norway’s government is suggesting that revenues from the production tax replace parts of the host municipalities’ share of income from the sales of new licenses, which they have been awarded since 2017 through the country’s Aquaculture Fund. It also proposes that the regional and local governments are provided with a further 25 percent of future revenues from sales and auctions of aquaculture licenses.

From this years’ capacity adjustment, the government further suggests that NOK 1 billion (USD 98.1 million, EUR 90.1 million) is allocated to the municipalities in both 2020 and 2021 through the Aquaculture Fund.

The production tax will be given effect from 1 January 2021, with the first tax payments due in 2022. It will also include production from existing licences that have been awarded free of charge or well below market value.

Previously, a 40 percent resource rent tax had been proposed on salmon farms in Norway but these plans were scrapped. Indeed, the Finance Ministry’s statement confirms, “a profit-based resource rent tax is not suggested.”

The new proposal has been well received by industry. In Mowi’s first-quarter 2020 results, the board of directors said that a resource tax would have had significant negative consequences for the industry and its capital expenditures, employment, and local communities.

“Norwegian salmon farming is struggling with high production cost and any extra fee will just increase this burden and reduce Norwegian salmon farming’s competitiveness accordingly. However, a production fee of NOK 0.40 [per kilogram] is far better than the recommendation from the Parliament-appointed committee of a 40 percent resource tax,” it stated.

Photo courtesy of aliasemma/Shutterstock


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