Salmon industry cool on amended tax plan

Norway’s salmon farming industry has so far given a lukewarm reception to the government’s latest proposal for taxing aquaculture.

Finance Minister Trygve Slagsvold Vedum has said in a letter to Norway’s parliament, the Storting, that the proposed “ground rent” tax – which is intended to tax industries that use marine resources – will now be calculated using internal industry prices rather than the (often higher) prices listed on the Oslo Stock Exchange.

However, Vedum is insisting the industry must be able to verify the price to an independent council.

He says this change means the industry can now enter into long term contracts and reverse plans to lay off hundreds of salmon process workers. Several contracts worth a total of NOK 35 million (almost £3m) have been cancelled during the past few weeks.

Salmon companies had earlier complained that, from next year, they will be paying tax based on the spot market price of salmon, not on real prices, given that much of their product is sold on fixed-price contracts.

Because of the original proposal contracts had virtually come to a halt. Vedum told the Storting in a letter: “I now believe there is no reason for the processing business to wait to enter into contracts.”

However, the employers’ organisation Seafood Norway (Sjømat Norge) is sceptical, saying that while it is a step in the right direction, there are still a number of unanswered questions.

The group’s policy manager, Peder Weidemann Egseth, said he will study the proposal to see how it will affect the industry.

He added that nothing was yet known about the so-called independent council, its composition or how it planned to check actual prices. He also feared that it could lead to extensive bureaucracy and a lot of extra work.

Although no meetings have been fixed, the two sides are expected to get together for talks on Vedum’s plan.

Meanwhile, the opposition Conservative party has proposed delaying the introduction of the tax until 2024 because there are too many issues to resolve.

Even with allies, however, the Conservatives do not have a majority to get their plan through parliament.