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Thursday, May 23, 2024

Tax lists still set off media frenzy

Norway’s national tax director Hans Christian Holte had to speed up this year’s unique public release of taxpayers’ bottom lines, after newspaper Dagens Næringsliv (DN) got hold of many in advance and started publishing stories Thursday night. The annual release of all Norwegian residents’ taxable incomes, net worth and what they actually paid in tax still attracts huge interest, especially because it’s become more difficult for folks to anonymously snoop through the lists themselves.

Tax Director Hans Christian Holte ended up releasing this year's tax lists four hours earlier than planned. PHOTO: Altinn
Tax Director Hans Christian Holte, shown here with tips for how Norwegians can avoid paying too much tax, ended up releasing this year’s tax lists four hours earlier than planned. PHOTO: Altinn

Holte and his team at the state tax agency Skatteetaten had planned to release the key numbers from the latest tax returns (for 2015) at 3am on Friday. Instead they published them on their own website at 11pm Thursday, because DN was already publishing stories with accurate numbers from the returns of Norway’s wealthiest taxpayers.

“We have a tradition of putting this out as a package, but on Thursday a rather untidy information stream began,” Holte told Norwegian Broadcasting (NRK) Friday morning. “So we chose to release earlier.”

Trond Mohn on top
This year’s annual release indicates that businessman and philanthropist Trond Mohn of Bergen is Norway’s wealthiest, with a taxable net worth of NOK 9.8 billion (USD 1.2 billion). The 73-year-old Mohn, who built up a fortune producing and selling pumps and other equipment, also paid the most tax of anyone: NOK 318.8 million and is now donating much of his fortune to research and athletics projects.

Heirs to family fortunes filled seven of the 10 top spots on the list of those with the highest net worth, including salmon-farming heir Gustav Magnar Witzøe of Kverva on Norway’s northwest coast, the daughters of tobacco heir Johan Henrik Andresen and Mohn’s own son Frederik. Grocery business heir Johan Johannson of NorgesGruppen was in 9th place on this year’s list, with a taxable net worth of NOK 4 billion, followed by shipping heir Leif Ovesøn Høegh with NOK 3.83 billion. Nearly all the heirs work in their family businesses and have also branched out into other ventures, with DN reporting that 23-year-old Witzøe is investing in restaurant and technology start-ups.

Numbers can be deceiving
Most media outlets in Norway are finally stressing this year that two of the three key numbers released from Norwegians’ tax returns can be misleading. They reflect taxable income and taxable net worth, after deductions, meaning that real income and wealth can be much higher. Tax values attached to real estate and stockholdings, for example, also are generally much lower than market value. In some cases, people known to be wealthy can legally report low or even no taxable income after writeoffs, rather like how US presidential candidate Donald Trump reportedly managed to avoid federal income taxes for 18 years.

In Norway, however, the bottom lines of Trump’s tax return would routinely be made public along with everyone else’s. There would be no debate over whether candidates running for public office should reveal how much or how little tax they paid. All politicians, from the prime minister to those on a local city council, must accept that their taxable income, net worth and taxes paid will be made publicly available.

While the tax returns themselves are not released, no one with tax liability to Norway is allowed to withhold the income and net worth numbers they filed on their tax returns from public review. “This is still a unique system of openness here in Norway,” tax director Holte noted Friday morning, adding that he’s often asked to speak abroad about how it works and the principles behind it. He says other countries are interested in proposing the same openness.

Ranks individuals’ contribution to the welfare state
Despite their debatable reflection of actual income and wealth, the lists do give an interesting and accurate overview of actual taxes paid. It’s thus possible to find out exactly how much, or how little, everyone contributed to Norway’s social welfare state. Those paying a lot of tax often get a lot of favourable publicity, while those seen as paying relatively little can be questioned.

National and local media outlets thus compile and publish the lists, with local newspapers and websites running tailor-made lists featuring residents of their communities. Lists are also run featuring those in specific branches, be it politics, the arts, media or business. Everyone could learn on Friday, for example, that Prime Minister Erna Solberg paid NOK 677,459 in taxes on taxable income of NOK 1.57 million, while Labour Party leader Jonas Gahr Støre remains the wealthiest top politician in Norway with a taxable net worth of NOK 64.4 million, after his family sold its Jøtul oven manufacturer in the 1970s.

For a list of income, wealth and tax information for all members of the Norwegian government, plus leaders of Norway’s political parties, click here (external link to NRK’s compilation, in Norwegian, but scroll down to the lists.)

On a national basis, the taxpayer ranking second on the list after Mohn’s NOK 318 million was businessman Øystein Stray Spetalen, followed by the founder of securities firm Pareto, Svein Støle. Spetalen paid NOK 142.6 million in tax, while Støle paid NOK 124.6 million. The young salmon heir Witzøe was fourth on the list of those paying the most tax (NOK 122 million) followed by industrialist Kjell Inge Røkke, who paid NOK 83.3 million in tax. Røkke also ranked high on the list of those with the highest net worth (third, with NOK 9.7 billion) but he was among those showing zero taxable income.

While the tax lists are searchable, the numbers of those actually looking up tax information on specific individuals has taken a dive since authorities made that process more open as well. To crack down on sheer snooping, and even bullying or home burglaries tied to income and net worth numbers, the government included a requirement that taxpayers would be informed who conducted a search on them. Holte said that has led to a 90 percent decline in searches that earlier could be done anonymously. Some opposition politicians, including within the Labour Party, are calling for a return to anonymous searches. A new debate may thus arise over openness versus privacy.

For NRK’s list of taxpayers ranked in order of net worth, click here. For its list of who paid the most tax in Norway, click here. (both external links, in Norwegian, but readers can scroll down to the lists). Berglund



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