Norway: Alterations of the Norwegian tonnage tax regime
International Tax Review is part of the Delinian Group, Delinian Limited, 4 Bouverie Street, London, EC4Y 8AX, Registered in England & Wales, Company number 00954730
Copyright © Delinian Limited and its affiliated companies 2023

Accessibility | Terms of Use | Privacy Policy | Modern Slavery Statement

Norway: Alterations of the Norwegian tonnage tax regime


Ragna Flækøy Skjåkødegård

The Ministry of Finance recently published its letter of notification of the tonnage tax regime to the EFTA Surveillance Agency (ESA), outlining the following alterations in the existing tonnage tax regime:

Bareboat chartering out

The following restrictions/alterations are introduced for bareboat chartering out:

  • Bareboat chartering out is limited to 50% of the total tonnage of the company group's fleet within the tonnage tax regime during an income year. The Ministry of Finance suggest that there should be an option to measure the bareboat chartered out fleet over a period of four years.

  • Bareboat charters must not exceed a contractual period of 5 (+3) years, i.e. five years with the option to extend for three years. Bareboat contracts exceeding 5+3 years will thus constitute disqualifying assets.

  • Strategical management of all vessels chartered out on bareboat terms must be performed from within the EEA.

The Ministry states that intra-group bareboat chartering out will be allowed "unconditionally". There are no limitations introduced for chartering in on bareboat terms.

The limitations are, as a starting point, applicable to new bareboat chartering out contracts. Tonnage chartered out on existing contracts, including options to extend for up to three years, will not be included in the limitation introduced. However, this transitional rule will not apply to what the Ministry calls "long-term contracts", defined as contracts of a duration of more than five years. Long-term contracts will thus be disqualifying for the tonnage tax regime.

Voyage charter/time charter

The Ministry notifies a limitation of 90% on the chartering in of non-EEA flagged vessels on time charter or voyage charter terms. Any limitations will be measured on a yearly basis, but counting the tonnage chartered out for each day of the year. The tonnage will be measured on a company group level. The limitation will only apply to new chartering in contracts.

Inclusion of windmill farm vessels

The Ministry of Finance notifies that vessels involved with construction, maintenance, repair and disassembly of windmills at sea are qualifying for the tonnage tax regime. Up to now, the windmill farm vessels have only constituted qualifying assets to the tonnage tax regime if they have been used in transportation assignments. The extension is notified to take effect from January 1 2017, and the extension was adopted by the Parliament in December 2016, but is awaiting the approval from ESA.

The extension does not comprise windmill farm vessels operating in Norwegian internal waters or Norwegian territorial waters.

Exclusion of vessels not being self-propelled and operating in foreign inland waterways

The Ministry of Finance also notifies that vessels that are not self-propelled and operating mainly in foreign inland waterways should not qualify for the tonnage tax regime. Vessels that are not self-propelled and operating mainly in Norwegian waterways are disqualifying according the current tonnage tax regime.

Except for the extension regarding windmill farm vessels, the alterations are planned to take effect from July 1 2017.

Ragna Flækøy Skjåkødegård (, Oslo


Tel: +47 23 27 96 00


more across site & bottom lb ros

More from across our site

Yusuf Akhmadi of Indonesia’s Directorate General of Taxation reports on the country’s latest domestic and cross-border initiatives to clamp down on tax evasion
The new rate is a blow to Samsung, while two law firms have made significant tax hires into their respective Washington DC offices
Rema Serafi, KPMG’s first-ever female vice chair for tax, talks about breaking the mould in an exclusive interview with ITR
The metal multinational’s victory, in a case worth $12 million, continues the trend of companies coming out on top against India’s revenue department
Guy Bud and Matthew Greene from litigation firm Stewarts review a dispute on tiered partnerships, which raises questions on corporation tax and partnership law
The stagnating pay and tax bonuses cap follow slashed payouts for the deals team and business consolidation in the last month
A greater UN role has been secured after disagreements between developed and developing countries over the OECD’s influence in global tax reform
The US-based firm picks up investment fund specialist Ceinwen Rees, while Ireland nearly doubles its corporation tax receipts in three years
The order comes amid controversy over another of David Collard’s companies’ tax and TP affairs
NASSCOM, which represents over 3,000 Indian companies, has argued for the removal of the segmentation rule