A proposed 35% tax on Norwegian salmon production could have severe long-term implications for the country's fish farming sector, Nordic Credit Rating (NCR) said in a report published today.
The Norwegian government has proposed a "resource rent tax" on the sea-phase production of salmon and trout to take effect retroactively from 1 Jan. 2023. The proposed levy would effectively raise the sector's corporate tax bill to 57% (compared with the normal corporate tax level of 22%).
NCR said that if enacted as currently proposed the tax would be slightly credit negative for the country's salmon farmers; the likely impact on their cash flow metrics is likely to be moderate and could be mitigated by lower dividend payments to shareholders. However, it added that the long-term effects on the industry could be substantial as investments are channelled abroad into more tax-friendly jurisdictions.
Contacts:
Geir Kristiansen, analyst, +4790784593, geir.kristiansen@nordiccreditrating.com
Gustav Nilsson, analyst, +46735420446, gustav.nilsson@nordiccreditrating.com