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Friday, July 19, 2024

Multi-billionaire, Norwegian style

Hotel and real estate tycoon Olav Thon, known for his trademark wool cap and riding in a Suzuki, has re-emerged as the wealthiest Norwegian taxpayer, at least according to state tax lists released on Friday. The annual release of figures showing every Norwegian taxpayer’s income, net worth and taxes paid, meanwhile, is sparking debate.

Wealthy real estate investor and businessman Olav Thon showed his support for the Progress Party with full-page ads in major Norwegian newspapers on Tuesday. FACSIMILE:
Billionaire Olav Thon often attracts attention, like when he ran full-page ads in major Norwegian newspapers explaining why he intended to vote for the conservative Progress Party. FACSIMILE:

The new conservative government wants to further restrict access to the lists, following up on the former left-center government’s decision to already limit their availability over the Internet. Norway has made tax lists public since long before the arrival of the Internet, allowing Norwegians to see for themselves what their family, friends or enemies had reported to the authorities. The blatant snooping, officials argued, made taxpayers more likely to be honest, because if their income or assets were suspiciously low, others might raise questions.

The mass availability and easy access enabled through the Internet generated huge traffic for websites offering links, but ended up setting off concerns for both personal security and privacy. There were incidents of homes being burglarized because the thieves had selected their targets off the lists. There also were reports of children being bullied at school, because classmates had checked what their families earned and were teased for either being too rich or too poor.

The spirit of fellowship and openness in Norwegian society that has justified the income and tax disclosure is thus giving way to the privacy and safety concerns. Newspaper Aftenposten reported Friday on how the new government declared in its platform that it would “secure that intruders don’t have access to personally sensitive information about income and fortune in the tax lists,” by making sure that taxpayers would know who had logged in to check their figures. That’s expected to deter the nosey neighbours, colleagues or classmates from snooping.

Kjell Inge Røkke's staff are working hard to prevent anyone else from using the "Aker" name. PHOTO: Views and News
Industrialist Kjell Inge Røkke, who started off as a fisherman, ranked second after Olav Thon on the tax lists in terms of taxable net worth. PHOTO: Views and News

Researchers fear less disclosure will lead to lost tax revenues to the state, because taxpayers will no longer worry that acquaintances can see what they’ve reported to tax authorities. New Finance Minister Siv Jensen told Aftenposten that the government hadn’t yet made any firm decision on how they would try to restrict access.

Real estate tycoon Thon, meanwhile, is accustomed to topping the list of Norway’s wealthiest taxpayers. The 90-year-old self-made billionaire from the mountains around Hallingdal was listed as having taxable net worth of NOK 9.9 billion (USD 1.65 billion) and taxable income of NOK 37.7 million in 2012. He paid tax of NOK 124.86 million, three times the amount of his income.

The “taxable” quantifier, though, is important because the figures shown in the public tax lists don’t always reflect actual wealth. Taxable values of assets are much less than market values, for example, and taxable income reflects various deductions, so the actual wealth of taxpayers is often much higher than what the numbers imply.

Norwegian media still gives broad coverage of the lists, which this year has industrialist Kjell Inge Røkke in second place with net worth of NOK 9 billion but zero income. He nonetheless paid NOK 99.7 million in taxes for 2012.

Tobacco heir and investor Johan Henrik Andresen ranked third, with net worth of NOK 6.7 billion and income of NOK 9.8 million. His tax bill was NOK 77 million.

The taxpayer with the highest taxable income was Trond Mohn, the Bergen-based philanthropist who made a fortune in the offshore industry. He earned NOK 323.7 million last year, and paid NOK 134.2 million in taxes. His net worth of NOK 3.9 billion ranked just after Andresen’s.

For NRK’s compilation of Norway’s 100 wealthiest persons, click here (external link, in Norwegian). “Kommune” is where they live, “formue” means net worth, “inntekt” is income and “skatt” is tax paid.

Thon, who turned 90 in July but remains active, has an indifferent approach to his wealth. From humble beginnings in the mountains, he went from being a fur trader to a real estate magnate who now owns 450 commercial properties, operates 88 shopping centers and controls 10,000 hotel rooms in Norway, the Netherlands, Belgium and Sweden, according to newspaper Dagens Næringsliv (DN). He has no children and  ranks as the largest private donor to the Norwegian trekking association DNT (Den Norske Turistoreningen), according to DNT itself, which has built several of its mountain lodges with money from Thon, an avid hiker.

He has often prided himself on the taxes he’s paid, telling Aftenposten last month that he has paid NOK 4 billion in taxes since he turned 75, “and there’s not many people who  have done that.” He created headlines, though, when he paid for full-page ads in some Norwegian newspapers during the recent parliamentary election campaign saying that he’d be voting for Norway’s most conservative party, the Progress Party in order to help get a conservative coalition government in Norway. The Conservatives have promised major cuts in Norway’s annual tax on net worth.

“It’s very nice if I can pay a little less tax than I have so far,” said, “but I can assure you that the ad and its message wasn’t at all motivated by my own economic gain.” Rather, he feels that lower taxes would result in more private investment and create more jobs, and he now hopes the conservative coalition that won government power will follow through on its promises. Berglund



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