October 1, 2022

ModularPhonesForum

Complete News World

Røkke can profit from the action

Røkke can profit from the action

Kjell Inge Røkke wants to save millions in property tax and can negotiate his own tax with the authorities in Switzerland.

Kjell Inge Røkke can save large sums with lower rates of wealth tax and dividend tax in his new home country.

Kjell Inge Rokke, one of Norway’s richest men, sparked strong reactions when he announced he was moving to Lugano in Switzerland on Monday.

A Letter In the style of “fellow shareholders and employees”, he did not cite tax benefits as a reason.

– but this is clearly seen as a tax-related move and a warning about wealth tax, says Ole Gjems-Onstad, tax expert and emeritus professor at BI.

The red-green government raised the property tax from 0.85 percent to 1.1 percent for those with assets over NOK 20 million. At the same time, they reduced the so-called valuation allowance on shares, residential and commercial properties and operational assets from 45 per cent to 25 per cent. This means you pay a higher rate of tax on the assets you are sitting on.

In 2020, Rokke was one of Norway’s second-largest taxpayers, behind Salmon heir Gustav Magner Witse. Since 2012, he has paid about NOK 1.2 billion in taxes.

1 million in property tax every day throughout the year

How much money could Kjell Inge Røkke save by moving to Switzerland?

That calculation is two-fold. One thing he wants to save is by not paying Norwegian tax rates on assets and dividends.

In 2020, DN reported that Røkke had a net worth of NOK 19.6 billion in 2020.

See also  The Minister of Health announces drastic national measures - NRK Norway - Overview of news from different parts of the country

– At a careful guess, today that would represent a net worth of at least NOK 25 billion. This would mean a property tax of NOK 275 million a year. To cover this, he has to withdraw an amount equal to the dividend. This means he will also have to pay 150 million in dividend tax, Gjems-Onstad says.

– Or to put it simply, he has to pay NOK 1 million in tax every day of the year because of his wealth, he says.

Individual contracts

It is unclear how much Røkke will pay in Switzerland. In Lugano, property tax is 0.3 percent of the same values, according to Finanzavisen.

NRK stands for Consulting Firm Overview Metamorphosis. Accordingly, the property tax on Røkke’s new home in Ticino is 0.48 percent for properties over NOK 52 million.

In Norway, by comparison, it totaled 1.1 percent of assets over NOK 10 million. NRK writes that if you take the 2019 wealth figures as a starting point, he would have saved NOK 120 million in lower property taxes.

But Swiss authorities also have special tax rules for foreigners visiting the country. In addition, they enter into individual tax treaties with persons visiting the country.

– but he can expect significantly lower wages than in Norway, says Gjems-Onstad.

Shares can be sold tax-free

The second part of the tax calculation is about what Røkke could earn by selling the shares after living in Switzerland for five years. After five years of residence, you no longer have to comply with Norwegian tax rules. In Norway, you are taxed at 35 percent of the capital gain when you sell shares. There is zero tax on this in Switzerland.

See also  ALS: - Lost both brothers:

– Røkke’s assets today are estimated at around NOK 45 billion. Gjems-Onstad says that if one assumes that two-thirds of this is unrealized gain, he will not have to pay tax on values ​​equal to NOK 30 billion.

He stresses that this is a hypothetical example, and he believes it unlikely that Røkke would want to sell his companies wholesale.