The Norwegian government has revealed its proposed budget for 1999. Plans include a one percentage point increase in personal and corporate income tax to 29%.
The industry to be most effected is shipping. Tonnage tax would be increased and the means of financing debt would be altered. Smaller companies would be hit the hardest.
As for personal tax, the size of the highest tax bracket would be increased. In effect, more people would be paying up to 50% tax.
However, it is debatable at this stage whether any of these planned changes will be passed by parliament. The government has less than one-third of the 165 seats. To implement the proposals a general majority of votes is needed, and opposition to the budget is strong.
If parliament passes the budget, it could mark a significant departure from previous years. According to partner Stig Sollund of law firm Thommessen Krefting Greve Lund: ?They are radical proposals in that they challenge the tax reforms decided by the great majority as part of the 1992 tax reform agreements. If these proposals get through other elements could be changed in the future.?
