Norway aquaculture tax plans ‘destructive’

THE head of Seafood Norway has described the new tax plans for the country’s fish farming industry as potentially destructive.

Geir Ove Ystmark, CEO of the organisation which represents most aquaculture and fishing companies (not be confused with the Norwegian Seafood Council), said the proposal for a 40 per cent tax on profits was ‘far from real world political reality’ and should be rejected as soon as possible.

The announcement was made in Oslo yesterday by University of Oslo economics professor Karen Ulltveit-Moe, head of an independent committee set up by the government last year to explore a new taxation scheme for aquaculture.

She said that when aquaculture development first started seriously back in the 1970s, few people realised what a success it would become.

But it has grown significantly in the past 20 years and changed in character from being an industry of small businesses to one dominated by large multi-national companies listed on the Oslo Stock Exchange.

Professor Ulltveit-Moe added: ‘’The aquaculture industry is spending money on the community\’s natural resources, and then the community must also get something back.’

But Ystmark said such a major restructuring of the tax system would not be accepted outside Norway and went against the business policy of strengthening competitiveness.

Norway’s seafood industry has great potential, he argued. But it was highly exposed to competition from other parts of the world and billions of kroner were now being invested in land based facilities in China, the United States, South Africa and the Middle East.

He said aquaculture was already a major tax payer, and a significant contributor to coastal communities through the Aquaculture Fund, which was working well.

But the industry was also facing major expenditure in trying to solve biological and technical challenges.

‘Don\’t tear away the glue that holds the nation together,’ Ystmark argued.

Political reaction has been mixed, with the left leaning parties largely in favour, although Labour expressed some worries about the impact on fish farming communities.

Norway is governed by a Conservative coalition, with some politicians on the right saying the proposals were already dead.

Finance minister Siv Jensen said she would not comment at this time and planned to send the recommendations to a special government committee for further consideration