– Something fundamentally unfair – E24

– Something fundamentally unfair – E24

It also wants more tax dollars from large, international companies operating in Norway. He says the move is a “very targeted drain on tax havens”.

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Governments around the world are losing billions in revenue as large international corporations shift their operations to avoid paying taxes in the country in which they operate.

On Friday, the government hammers out Norwegian rules on a universal minimum tax in the King’s Cabinet, with the proposal sent to the Storting for a final decision.

This was revealed by Finance Minister Trygve Slacksvold Vedum (SP) when he was a guest on the E24 podcast.

Read on E24+

Small neurotransmissions

– This means that large companies operating in various countries, including tax havens, may have to pay taxes if they move to a low-tax country. He says the global minimum burden should be 15 percent.

Scripture indicates that many large corporations move their businesses to avoid taxation.

– something fundamentally unfair about it, he says.

Trygway Slacksvold Vedum believes this tax plan will be easier to get through than the controversial salmon tax.

Must go through Storing

recommendationThe government put it up for consultation just before the summer, which is based on an OECD-driven international collaboration of 140 countries.

– This is the most targeted drain on tax havens.

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Vedum estimates that around 40-50 countries will adopt it in their national assemblies before Christmas.

– When 40-50 countries do it, it becomes reality, because many heavy economies adopt it at the same time. This means other countries will have to deal with it, says the finance minister.

– You need a parliamentary majority. Do you expect it to do well here?

– Yes, Vedam laughs saying that we have done tax reforms before and there was much discussion about it.

If the Storing Rules are adopted, they will come into force from New Year 2024.

Trykve Slacksvold Vedum believes that the lowest rate of corporate tax globally would serve Norway well.

Tax breaks will be extended

The rules cover 86 Norwegian groups and 1,300 foreign groups with one or more subsidiaries in Norway.

There are companies with a turnover of at least 750 million euros, or about NOK 8.8 billion at today’s exchange rate, which will be covered by the global tax rules.

Vedam gives an example: a large Norwegian international company operates in a market with a corporation tax of 5 percent. With these regulations, Norway imposes an additional tax on the company, meaning they actually pay 15 percent.

– We believe that over time the host country will raise its corporate tax to 5 to 15 percent, so that you get rid of tax havens, says Vedam.

Evaluates income

The research center came up in 2021 EU Tax Observatory Until the global minimum tax of 15 percent gives Norway 5.4 billion in additional income.

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The Ministry of Finance estimates that next year’s revenue will be NOK 9 billion.

– Initially, this will probably provide some revenue, but over time a country like Norway with a 22 percent corporate tax rate will not. But not having these kinds of opportunities would serve our institutions Excess transferExcess transferTax Justice Norway defines profit shifting as: transferring income you have earned in one country to another country, with the intention of avoiding paying taxes. In a NOU, the government defined the concept more technically: rules that reduce the tax burden in Norway, but to a lesser extent affect actual economic conditions.. This is a good thing for well-ordered economies like ours, says Veda.

– If this is recurring revenue for Norway, it can be used in the budget for 2025.

Over the past ten years, corporation tax in Norway has been reduced from 28 to 22 percent.

A lot more to come

The so-called Pillar 2 of the deal is just one round of tax measures being considered in the Cabinet today.

In the next round, the question of how corporate profits should be distributed between countries, known as Pillar 1, will be resolved.

– In pillar 1, there will be very few companies, because it is really big companies with a turnover of more than 20 billion dollars. The big ones are also covered by this, but in pillar 1 it’s usually about Google. Finance Minister says tech companies are making huge profits even though they don’t actually have any business here.

Read on

Norway could earn billions from international tax activities

Joshi Akinjide

Joshi Akinjide

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