The Green Movement, Oil Tax | A tax expert at BI gives Finance Minister Vedum a failing grade:

STORTINGET (Nettavisen): – You can make it happen if you want, says Eivind Furuseth, tax professor at BI Business School.

He has spent a year in Vienna, Austria, where he studied the extent to which Norway can and should use the tax system to achieve the climate goals it has set. .

Today’s finance minister, Trygve Slagsvold Vedum, receives criticism:

– Vedum could have done much more and used the political space he has in a much better way, Furuseth believes.

– Everyone agrees that climate change has happened and that something needs to be done. We need to reduce the use of oil and switch to cleaner energy. Then we have to use the tools that can be used, but the current government is not. It amazes me that they don’t even want to know what tools they can use, he says with frustration.

Read the response from Finance Minister Vedum further down on the matter.

Believing that it is more favorable to produce oil than hydroelectric power

– Today, tax regulations are more favorable for brown energy than green energy. For example, the oil sector is benefiting from the oil tax package, after extensive negotiation in the Storting. It brought very favorable tax rules to the business. Meanwhile, on the green side, hydropower is heavily taxed. Vedum and the government also introduced a land rent tax on wind turbines.

– The taxes you mention here were introduced to distribute money from the rich municipalities to the cities that have the least. Why is it wrong?

– The state should use the money they bring in on green transformation. They could be celebrated for just that. The distribution is good, but when the money is pulled into a pot together, it is only spread thinly.

– If you are serious about achieving the goals of the Paris Agreement, you must act.

– When the oil runs out one day, we have to have something else to live on. The conversion costs absolutely insane amounts and it requires us to take proper steps to make it happen, but it is not being done. The fact that tax regulations are now more favorable in the oil industry than in the green industry speaks for itself, Furuseth believes.

Tax measures can provide more affordable housing

It may seem that the government is hiding behind EU and EEA regulations.

– In the last few years, there has been more focus on the green movement and the desire to achieve the goals of the Paris Agreement. This increased focus on the green movement has meant that Norway has more room for maneuver than before when it comes to measures to promote the green movement.

– Several countries with which we would like to compare ourselves to do this more than we do. For example the Netherlands, Sweden, England, Austria and Germany. What these countries have in common is that they have much more industry than we do, says Furuseth.

– Some people think that it is right to have direct support, such as being able to apply for support for degrees from Enova. That’s good. But why not also use the tax system to a greater extent? asked Furuset.

– If companies believe that the tax benefits are clear, they will also invest more environmentally friendly. Therefore, the government should consider changing the tax rules so that it becomes more profitable to make environmentally friendly investments.

It continues:

– The construction industry is an energy intensive sector. If this business gets a carrot in the form of tax benefits if they invest in technology and tools that reduce climate emissions, it will be possible to cut greenhouse gases in that way. In addition, the industry can be encouraged to reuse materials, which may result in lower climate emissions and, in the long run, cheaper housing for the customer.

I don’t think Norway will meet the climate targets

Eivind Furuseth believes that we spend too little money on research and development compared to other countries. We spend much lower than the OECD average, he says.

– How much of that is due to the fact that war has broken out in Europe and we are spending more money on aid to Ukraine and our own defense?

– The figures I looked at come from the time before the war started, he says.

– We have rather ambitious targets for zero emissions and cuts in greenhouse gases that we need to reach, Furuseth says.

– Are we going to reach them?

– No, he answers immediately.

– Not as it seems today.

Vedum: – I do not feel that I have been beaten

– I don’t feel that the criticism has hit me. The government is pursuing an ambitious climate policy, said Finance Minister Trygve Slagsvold Vedum to Nettavisen.

It identifies climate taxes and participation in the EU quota system as important instruments.

– The use of climate taxes is widespread, also compared to other countries, Vedum believes.

– In addition to price emissions, several other instruments are used such as regulations, standards, agreements, subsidies for emission reduction measures and support for research and technology development, he continues.

He says the government is currently evaluating Norway’s new target under the Paris Agreement for the period after 2030. Norway is currently obliged to reduce greenhouse gas emissions by 50-55 percent by 2030.

The government will submit a parliamentary report on climate before Easter next year, Vedum continues.

Agree with the tax expert

The finance minister does not agree that there are better conditions for “brown” power than green.

– That’s not right. The petroleum companies will face a 78 percent tax. The special tax on petrol usually has a neutral effect on investments, as does the basic rental tax on hydropower and onshore wind power. Hydropower and wind power have a lower tax rate than petroleum, 67 percent and 47 percent respectively.

The Minister of Finance believes that it is difficult to compare the terms of the different sources of energy, such as oil and hydropower.

– The various businesses face various other taxes and fees. This makes a direct comparison of energy sources required. The petroleum companies also pay a high CO2 price for their emissions from the petroleum operations, as they have a quota obligation and a CO2 tax, he concludes.