Minister Vedum: “Farming in Norway is and will continue to be very profitable”

Trygve Slagsvold Vedum, Norway's Minister of Finance, has spoken about the salmon tax in an interview with the Norwegian media VG. Photo: Norway Ministry of Finance.
Trygve Slagsvold Vedum, Norway's Minister of Finance, has spoken about the salmon tax in an interview with the Norwegian media VG. Photo: Norway Ministry of Finance.

Despite the controversy surrounding the tax, with stalled investments in farming and layoffs in processing, Vedum maintains its position. "Farming in Norway is and will continue to be very profitable. This is a tax that goes on the profit", said Norway's Minister of Finance in an interview with the Norwegian newspaper VG. "We will listen to the input in the consultation, but we will introduce ground rent tax from 1 January", Vedum also says.

"We follow a Norwegian tradition"

Since the salmon tax proposal was introduced, the argument put forward by the Norwegian government, and especially by Vedum, has been the same. Those who earn a lot of money from the use of community resources should contribute more to the community in general and to local communities in particular. The Minister of Finance continues to maintain the same position. "It is crucially important for Norway that we have a tax system that means that those who have had the largest profits and have built enormous fortunes by harvesting from our common natural resources must contribute more with income that benefits the coastal municipalities and the coastal population", he says in his interview for VG.

The minister says he understands that some companies do not want to pay this tax because it means they will be able to distribute "a little less in dividends", but, he says, "we follow a Norwegian tradition that companies that have very large profits as a result of harvesting from the community's natural resources must pay an additional contribution back to the municipalities, local communities and the community". Trygve Slagsvold Vedum also reiterates his position that real income must be the basis for this taxation of the aquaculture industry. "They must not pay too much tax, nor too little", he says this time and assures that he has made this known to the Norwegian Parliament in a letter.

"The basic interest tax works both ways"

In the interview, the minister acknowledges that there is debate and opposition from some players in the salmon industry, but adds that there are also some small players who are positive. According to him, his proposal makes it clear that you can have revenues of up to NOK 60-70 million (€5.7-6.6 million / $6-7 million) before you have to pay the tax. Again, in addition to insisting that much of the revenue will go back to the municipalities and coastal counties, Vedum has also stressed that smaller companies are protected thanks to what he defines as "a large bottom deduction".

"The basic interest tax works both ways. You are taxed when you have a profit, but receive a corresponding deduction when they invest. They therefore receive a 40 per cent deduction on their investments, which is much more than other industries. Especially for new companies entering the industry, it results in much lower capital costs", he tells VG. And Norway's Finance Minister reinforces his statements with an example: "If you invest 100 million, you get back 40 million from the state".

"There will be investments"

The Norwegian tradition is that those who have more should pay more; those who earn more should contribute more, especially if they do so at the expense of natural resources that belong to all citizens… the government and Trygve Slagsvold Vedum himself have repeated these messages over and over again since the salmon tax proposal was presented and the debate opened. As a consequence, although not the only ones, the largest companies – those most affected – have also been the most critical of the proposal. "Yes, the very largest companies have been very clear", the minister acknowledges to one of journalist Bjørn Haugan's questions for VG.

However, when Haugan reminds Vedum that large companies say they will stop investing, the minister rejects the possibility that this will affect Norway. "There will be investments, I'm sure of that", he claims. According to him the auction with new permits this autumn aroused a lot of interest, only it was not the biggest companies that bought the most but the small and medium-sized companies that bought at a good price. "It's good that we get that diversity. This is a profitable industry that will continue to live well", Vedum concludes.

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