Court upholds property tax

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The much-disputed property tax levied by Oslo’s newly elected Labour Party-led city government last year is not illegal, ruled a local court on Tuesday. The national organization representing homeowners (Huseiernes Landsforbund) had sued the city, arguing that it’s paid by far too few Oslo residents, based on their home values.

New waterfront condominiums like these here at Sørenga in Oslo can be among those hit by the city’s new and much-disputed property tax. An Oslo city court ruled Tuesday, however, that the tax is not illegal. PHOTO: newsinenglish.no/Nina Berglund

The organization, which filed suit on behalf of around 3,500 homeowners in Oslo, had claimed the city must refund all the hundreds of millions of kroner it has collected since last summer. Instead it lost its case, and now must itself pay more than NOK 471,000 in court costs.

“Huseiernes Landsforbund has decided that it will not appeal the ruling,” its attorney, tax expert Bettina Banoun, told Norwegian Broadcasting (NRK) on Tuesday afternoon. “There are several taxpayers who want to take the case further, but it will take some time to evaluate the verdict and see if anyone wants to become the new representative for the group.”

Banoun is one of Norway’s most recognized tax experts, and she had argued that Oslo’s property tax was discriminatory because it affects only those with property values assessed at more than NOK 4 million. That means owners of only around 20 percent of the city’s residences are actually taxed, and they were collectively charged around NOK 510 million this year, to help finance day care and elder care in the capital. That’s up from NOK 266 million last year, after the city raised the tax rate by 50 percent on property values that were assessed nearly 20 percent higher than in 2016.

“The Labour-led city government has chosen a model that serves its voters,” Banoun told NRK. “All the neighbourhoods with a large Conservatives constituency are hit, and that’s indirect discrimination.”

The court disagreed, after the city’s defense attorney, Trine Riiber, argued that the tax is legal precisely because it expresses a political viewpoint. “This was examined closely by the city,” Riiber said. “The city’s view is absolutely a political view and not something the courts can overrule.”

Judge Finn Eilertsen conceded that the tax affects many homeowners in an “unfortunate” manner, since only around 20 percent of them have to pay it. He noted, though, that “any weaknesses in the property tax formula must be evaluated by those imposing the tax,” not the court.

Banoun was far from convinced, and said she thinks Norway’s highest court would have another opinion. It’s not right, she maintains, that a small portion of the population gets hit by such a heavy tax, which is costing some homeowners more than NOK 20,000 a year.

“This is a case that I think would be natural to be heard by the Supreme Court,” Banoun said, “so we’ll see if anyone else wants to bring it further.”

newsinenglish.no/Nina Berglund