SHARE
COPY LINK

TAX

Norway a ‘pimp’ for my prostitute client: lawyer

Norway’s tax office risks facing pimping charges if it insists on taxing a 29-year-old Lithuanian prostitute, the woman’s lawyer has said.

The eastern branch of the Norwegian Tax Administration (Skatteetaten) slapped the woman with a 1.2 million kroner tax bill after tracing undeclared income to her bank account, newspaper VG reports.

The woman said she acted in good faith when she didn’t tell the tax office about the money she earned from prostitution from 2006 to 2010.   

Her lawyer, John Christian Elden, said the Norwegian state was not authorized to demand a cut of earnings from prostitution.

“This contravenes the penal code and is punishable as a pimping offence,” Elden told the newspaper.

“The provision [regarding prostitution in Norwegian law] is set up in such a way that it protects people who have to prostitute themselves, while also enabling them to retain their income.”   

Never before has a Norwegian court heard a case involving a valued added tax bill for prostitution, and Elden has said he and his client won’t take it lying down.

“If the tax demand stands, we’ll report the state for pimping,” he told VG.

Elden said the hefty tax bill would essentially force his client to prostitute herself again to pay off the state paymaster.

The head of the regional tax office’s anti-evasion unit, Jan Egil Kristiansen, said he was prohibited from commenting on individual cases.

“But all business activity is liable for tax and VAT. There’s no exception for prostitution,” he told VG.

Member comments

Log in here to leave a comment.
Become a Member to leave a comment.

OIL

Why Norway’s earnings dropped in 2020 despite steady taxes from individuals

Did Covid-19 take a chunk out of your income last year? You’re not alone. The pandemic also cost Norway ten percent of its tax earnings. But the revenue loss can’t be spotted when looking at payments from regular tax payers.

Why Norway's earnings dropped in 2020 despite steady taxes from individuals
Photo: Giorgio Grani on Unsplash

While the state’s reduced income is linked to the Covid-19 pandemic, and the measures to combat the spread of the virus, individuals last year actually paid more tax than the year before. 0.8 percent, to be precise.

Yet the Norwegian tax revenue amounted to 858 billion kroner, 85.8 billion euro, last year, a 9.1 percent decrease from 2019, according to official figures from Statistics Norway (SSB).

Plummeting oil prices

The main driver of the decline is the reduced income from taxes on petroleum. The industry only paid 28 billion kroner, about 2.8 billion euro, in taxes last year. A staggering 80 percent drop from the 134 billion kroner paid the year before.

The petroleum industry is by far Norway’s largest economic sector. And, like all oil-exporting countries, Norway has been hard-hit by the sudden drop in demand ­– coupled with a global glut – for petroleum, noted, among others, by the OECD.

The impact of the pandemic on the international petroleum and crude oil market was undeniable when the barrel price plummeted from 45 dollars in March last year, to a record low at under 25 dollars in April. And all through the pandemic it fluctuated below 45 dollars, before eventually making a recovery in December, according to the overview from Business Insider.

Support investments

To help the industry weather the storm, Norway slashed its taxes and fees.

“Oil and gas industry is an important resource for Norway,” said Minister of Finance Jan Tore Sanner in a May press release.

“It is therefore important for the government to contribute to upholding the activity in the oil and gas industry and the suppliers to this industry in order to ensure that they make it through the Covid-19 crisis,” he continued.

The goal was to free up an additional 100 billion kroner, 10 billion euro, for investments.

Increased activity

The approach seems to have been successful. A recent report by the Norwegian Petroleum Directorate (NPD, ‘Oljedirektoratet’), concludes that activity on Norway’s continental shelf was bustling last year, despite the problems plaguing the industry in the rest of the world.

“While 2020 has been an unusual year in many ways,” said Director General Ingrid Sølvberg in NPD in a press release, “investments on the Shelf are at the same level as previous years.”

Fossil-dependent

Not everyone shares the enthusiasm, however.

Member of Parliament Kari Elisabeth Kaski from the Socialist Left Party thinks the investment level may increase Norway’s reliance on the fossil energy sector. This is particularly problematic, she believes, in a time where more resources and attention ought to be directed towards sustainable and green energy solutions.

“The reality is that one has given subsidies of such a magnitude that investments in oil have exceeded expectations,” she told newspaper Aftenposten in January.

“This makes Norway more dependent on oil, an unwise direction for Norway to take in the recovery of this crisis,” she continued.

SHOW COMMENTS