New tax regime for Norwegian shipping companies

Today, the Norwegian Government has announced that it will propose a new tax regime for Norwegian shipping companies in the National Budget for 2008. The proposed tax regime will be similar to the tax regimes available for the industry in the European Union.

The Norwegian shipping industry has since 1996 had a favourable tax regime with taxation of company profits only upon withdrawal of profits or exit from the scheme. With the growing number of tax exemption regimes within the EU, it is apparent that the present regime no longer is able to attract new investments in Norwegian shipping companies.

The proposal will ensure competitive conditions for Norwegian shipping companies. At the same time, the Government proposes that 2/3 of the deferred taxes in the present regime, estimated to NOK 14 billion, be paid over a period of 10 years. The shipping companies will be allowed to use the remaining 1/3 of the tax obligations for environmental investments.