The statement came after Finance Minister of Britain, George Osborne proposed cutting corporate tax to 15 percent, writes NRK. Svein Flåtten, chairman of the Finance Committee in the Norwegian Parliament, fears that Norway will become less attractive for businesses if they do not adopt tax cuts.
Norway’s corporate tax is currently at 25 percent, and by 2018 it will be lowered to 23 percent.
Talking to NRK, Flåten says they compete to attract new companies and to ensure Norwegian companies not to move out of the country.
– When coporate tax is lowered, a smaller share of corporate profits go to pay taxes. Therefore, a low tax level could attract companies and help them establish and carry out in Norway, says he.
But Professor of Economics at the University of Oslo, Halvor Mehlum thinks Britain is not important enough for Norway and lowering corporate tax can lead to more serious consequences in terms of financial relations with other countries.
– I understand the logic of Svein Flåtten, but Britain has not sufficient importance that has something to say for Norway. It would be quite strange if Norway joins Britain in such a tax competition, he said to NRK.
Mehlum further explains that Norway can anger neighboring countries that are far more important, if it reduces taxes.