FRP Requires Government to Eliminate Property Tax Gaps – E24

The FRP now announces that it will file a new lawsuit in budget negotiations to deprive municipalities of this opportunity.

According to the Homeowners, several municipalities will take measures to increase the estimated value of homes next year.

In this way, municipalities can maintain, or even increase, the property tax in crowns and øre, even if the government reduces the maximum tax rate from five to four per thousand in the state budget.

It will be a defeat for Frp, which in recent years has had an impact on large property tax cuts.

Challenge government cuts

The ability of municipalities to oppose lower property taxes is not just theoretical:

A survey of the homeowners budget shows that what is basically a big win for FRP (reducing the tax rate from seven to five per thousand this year and more to four per thousand in 2021) has been mistaken for reality:

• This year, Norwegian municipalities estimate a total property tax revenue of NOK 7.6 billion. The $ 7.9 billion decline in 2019 is far less than the tax rate cut indicates.
• And for next year, the municipalities estimate 7.8 billion in income from property taxes, that is, 200 million plus than this year, even though the tax rate is lowered further.

Helge André Njåstad from FRP, who sits on the local government and administration committee, is strongly provoked:

– Municipalities that deviate from the guidelines of the parliamentary majority cheat. These are clear guidelines from the top team and are expected to be followed, Njåstad tells E24.

These are the treasure hunts

In addition to reducing or eliminating the lower deduction, municipalities can offset the lower tax rate by increasing the estimate of your home’s value.

Today, municipalities have two options when determining home values:

They can use standardized figures from the Tax Administration based on data from Statistics Norway or evaluate the properties on their own.

Municipalities can switch between these different calculation methods. Those who already use appraisers can also do a new home appraisal every ten years. This will often give jumps in value.

– This freedom of choice is very unfortunate because local appraisals often give a more random result, says Carl Geving, director of the Norwegian Real Estate Association.

– Conflict of interests

– With municipal rates, a conflict of interest arises when municipalities collect the tax and calculate the values ​​of the houses that provide the tax base. This gives the risk of the values ​​being calculated too high, continues the broker’s manager.

According to NEF, there are more frequent complaints about the value rates set by the municipality itself, than the house values ​​calculated from Statistics Norway.

E24 has previously written about the popular uprising after Bodø revalued properties in the municipality, which, among other things, led to the value of farmer Magne Kristensen’s farm suddenly increasing by 380 percent, from 1.3 to five. million crowns.

Homeowners Secretary General Morten A. Meyer cautions that “several municipalities” are doing such reassessments this year.

“Unfortunately, this means that in some municipalities many homeowners experience a significantly higher property tax than last year, even at a lower tax rate,” he says.

FRP requirements: no municipality can self-assess

FRP says that they will now demand the total abolition of assessments, so all municipalities must use home value calculations for Statistics Norway.

Njåstad emphasizes that the party wants all property taxes to come to life.

– But as part of the way, we must make sure that no municipality spends more money to collect a fee that the state already has. So yes, we will demand it, says the FRP profile.

He calls the valuation scheme a money drain with large random effects.

– When residents do not have a guarantee of how the house is evaluated, and the value is realized by retirees, sports clubs or people with unemployment benefits with an hour of training, then we must act, says Njåstad.

The alternative is not perfect either

At the same time, the alternative to assessments – the Norwegian Statistics figures that FRP will now force all municipalities to use – has not been clear in criticism either.

In the fall of 2019, NRK Brennpunkt sent out a documentary showing how Statistics Norway’s calculation method allows more expensive homes to escape tax.

– The problem is that the tax assessment system prepared by Statistics Norway for the Tax Administration is too bad, says Henning Lauridsen, director of Eiendom Norge.

He also supports the abolition of assessments in municipalities, but believes that it is not enough to use only the current figures from Statistics Norway.

– We need a completely new system, he says.

Njåstad in Frp admits that Statistics Norway’s calculation model may also have “unfortunate” results, including the fiscal favoring of more expensive homes.

– However, I think this is a scheme that can be adjusted very well to be more precise, he says.