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110 Billion Decline in Petroleum Revenues of Norway

Petroleum revenues totalled NOK 184 billion in 2015, according to preliminary figures. This is more than 100 billion lower than in 2014 – and can be attributed to decreased taxes from companies engaged in petroleum extraction. Petroleum taxes dropped from NOK 146 billion in 2014 to NOK 75 billion in 2015 – a decrease of almost 50 per cent. This is mainly explained by falling oil prices in recent years.

Growth in property income and taxes from Mainland Norway

General government revenue excluding petroleum is calculated at slightly less than NOK 1 500 billion in 2015 – an increase of almost 7 per cent from 2014. Income from interest and dividends in the Government Pension Fund Global, as well as taxes from households and companies in Mainland Norway, were contributing factors to this.

Increased benefits to disabled and unemployed persons

General government’s social benefits to households amounted to approximately NOK 460 billion in 2015 – which corresponds to an increase of 7 per cent from 2014. The increase can partly be explained by the fact that new regulations regarding disability pensions were introduced in 2015. Compared to the previous regime, a larger portion of the disability benefits is now subject to income taxation. To compensate for this, the gross disability benefits were adjusted upwards, in order for the net benefits (gross benefits less taxes) to remain the same as before 2015.

In addition, unemployment benefits have risen as a consequence of the increasing number of unemployed persons in Norway.

Prolonged deficit in the local government sector

In 2015, revenues rose slightly more than expenditures in the local government sector, compared to the previous year. Preliminary figures indicate a deficit of NOK 22 billion in 2015, according to book values. This is the ninth year in a row with local government deficit in excess of NOK 10 billion. Considerable growth in expenditure related to fixed capital formation has contributed to the prolonged deficit.

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