New Mowi chief predicts tax plan will be scrapped

THE new chief executive of Mowi has predicted that Norwegian plans for a controversial salmon tax will eventually be rejected.

Ivan Vindheim, who took over the helm from Alf Helge Aarskog this week, said the proposal would have a devastating effect on salmon farming in Norway and, for this reason, he did not believe politicians would proceed with the main recommendation of a 40 per cent flat tax on profits.

He pointed out that salmon farming was no longer a local activity and future investment would take place where costs were lower. This would only lead to fewer jobs at home.

He warned: ‘Tax is a cost just like any other so future capital will be invested where costs are lower.’

However, fish farming companies have been told that the proposals were not dead despite strong opposition from most of the parties in the ruling coalition government.

Finance minister Siv Jensen said she is not rejecting the idea out of hand and has sent a report to a special government committee for further discussion.

The tax was proposed last week by an independent group, chaired by economics professor Karen Helene Ulltveit-Moe.

The committee said that as salmon companies used natural marine resources, to which they had been given largely free access, it was only right they should give something back.

Minister Jensen told MPs that she has not yet decided what action to take over the committee’s recommendation, but said it was important to get a wide range of views.

She added: ‘It is also important to me, both as (Progressive) party leader and as finance minister, that we should have good competitive conditions for the aquaculture industry.’

The industry has reacted angrily, with the trade association Seafood Norway saying it could deliver a fatal blow to the industry. Billionaire owner Ola Braanaas of Firda Seafood is already reported to be threatening to pull out of Norway if the proposal is implemented.

Geir Ove Ystmark, CEO of Seafood Norway, told Norwegian business newspaper Finansavisen this week that not so many decades ago Norway was almost the sole salmon farming country in the northern hemisphere.

Then it spread to the likes of Scotland, Canada, the Faroe Islands and Chile. Now the United States, Australia and New Zealand were important players, while China and Russia were actively developing their own salmon production.

And there are plans to develop desert based salmon farms in the Middle East. He said Norway must not tax itself out of business.

But the Labour Party has suggested that even if the proposals are eventually rejected by the current government, they may decide to bring them back if they win the next general election.