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Newsletter - Proposed changes to the petroleum tax system – reduced uplift

On May 5, 2013, the Government of Norway announced tax measures to stimulate the mainland economy and to counteract what is deemed to be an increasing gap between the offshore and the onshore economy.

As part of these measures, the Government proposes to reduce the corporate income tax rate from 28% to 27%, and a 10% opening depreciation for onshore investments in plant and machinery are proposed. For companies subject to the special tax regime for petroleum, it is proposed to increase the special tax from 50% to 51%, in order to maintain the total marginal tax rate of 78% for these companies.  Concrete proposals are expected to be issued on Tuesday May 7, 2013, in connection with the presentation of the revised budget for 2013. The Government has announced that the changes above will take effect as from January 1, 2014.

In order to stimulate more effective use of resources in the offshore industry, the Government has proposed to reduce the deduction for uplift in the petroleum tax system from 30% to 22%. These changes are proposed to take immediate effect, i.e. from May 5, 2013. This implies that the proposals on reduced uplift take effect from investments made on or after May 5, 2013.

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Partner Rune Tjomsås Andersen
E-mail: rune.andersen@adeb.no, telephone: +47 98 29 45 87

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