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Either it’s journalism against the best or they don’t know what’s better: TV 2’s zero-tax soup yesterday was thin and in bad taste.
The Labor Party wants to increase the wealth tax by seven billion crowns and wants to do it in a way that affects the wealthiest.
To achieve this, they will eventually increase the lower wealth tax deduction from NOK 1.5 to 2.0 million, but so far only by NOK 200,000 to NOK 1.7 million.
The result is dramatic, we must believe TV 2: «The Labor Party’s tax scheme will give 4,900 taxpayers zero more than what the state government budget will provide for 2021. This means that fewer Norwegians will have to pay taxes with Jonas Gahr Støre than Erna Solberg »Writes the television channel on its website.
Read the case: APS ‘New Tax Promise: 4,900 Zero Taxpayers More Than Erna
An overwhelmed Labor leader confronted this on television, and then SV’s fiscal policy spokesperson Kari Elisabeth Kaski fired a cannon: – Doesn’t hold up. This shows the consequence of the Labor Party being held hostage to right-wing fiscal policy.
The criticism is meaningless and means that the SV politician either does not know better or speaks against knowing better.
Therefore, the Labor Party must sharpen the wealth tax by seven billion. This is done by increasing the tax rate and reducing the discount on the so-called working capital. This should surgically affect the wealthiest, that is, those who are normally considered zero contributors.
And this is where the big mistake lies: It is not enough to pay zero in taxes to become a zero taxpayer. It’s a bad and imprecise concept.
Or as the country’s leading tax lawyer, BI professor Ole Gjems-Onstad, points out “there is hardly any Norwegian tax economist left who is willing to use the term zero taxpayer.”
Let’s take it with a teaspoon:
The typical zero taxpayer therefore has little income and wealth, but these, of course, are not what we think of in the debate. Therefore, the Labor Party change increases the lower deduction by NOK 1.7 million, but sharpens the tax on all of the above.
Mentally, we envision people rich in sugar doing tricks away from wealth tax and income tax, or as the TV 2 commentator put it, they might be “sugar-rich stock speculators.”
Store Norske Leksikon defines zero taxpayer as a “… person who, by using the rules of the tax law on business income and more, achieves disproportionately low income employment.”
The encyclopedia focuses on income, but it is a bit sparse. We should extend the concept of zero taxpayer also to those who cheat on taxable wealth through various adjustments.
The vast majority who pay zero taxes are therefore not zero taxpayers, as we use the word in everyday speech and as it is defined in the lexicon.
An estimate for 2018 showed that around 510,000 people in Norway have such low incomes that they pay no taxes.
SV and the left probably have a clear predominance of these “zero contributors.”
When the exemption card limit is increased or the lower deduction is increased, more “zero taxpayers” are also created, as TV 2 and SV’s Kari Elisabeth Kaski use the term, and it becomes completely meaningless.
Not surprisingly, Labor Party leader Jonas Gahr Støre was caught off guard by the question …
And then we get back to the point. The Labor Party Sharpen the wealth tax. They want to increase the tax rate from 0.85 to 1.1 percent of taxable wealth and they want to eliminate the return on working capital. These are measures that will undoubtedly provide less zero taxpayers as defined in the lexicon and understood in everyday speech, but in other words, some more who will pay zero in taxes because they have almost zero in income and a small fortune.
So where does TV 2 get the supposedly 4,900 more zero contributors? Yes, it is the Ministry of Finance that has calculated how many people get zero taxes by raising the lower deduction on assets from 1.5 to 1.7 million crowns.
TV 2 didn’t say more about who he is, naturally. It hung in the air that one could speak of stock speculators and what is worse.
But that is not the case.
We’ve come a long way by looking at the tax statistics from Statistics Norway. The typical new The zero taxpayer that the Labor Party creates is a pensioner with his own home; alternatively, young people or other people outside of working life who have inherited some money.
Typically, they should have less than NOK 55,000 in tax income (so they also have zero income tax).
According to Statistics Norway, just under 500,000 people had less than 100,000 NOK in gross income in 2018, and that number has held steady in recent years. To become a zero contributor, you must be in this group.
The wealth tax discussion has focused on very wealthy people who have low tax incomes. A look at wealth statistics shows that the vast majority of people with a net wealth between NOK 1.0 and 2.0 million are 67 years old or older.
In conclusion: When the Labor Party raises the lowest deduction, they mostly let retirees with low incomes and a small fortune escape the tax increase. As Jonas Gahr Støre replied, these are people from the lowest income groups.
When SV’s tax policy spokesperson Kari Elisabeth Kaski states that this means that they will not fight the growing differences in Norway and cannot afford major welfare reforms, it doesn’t make sense.
“Kill me sir, but not with oatmeal,” said Tormod Kolbrunarskald, according to Snorre.
It’s tempting to make a similar call to SV and TV 2: Kill us, but not with broth!
P.S! What do you mean? Is it reasonable to call pensioners with a small fortune zero taxpayers, as SV and TV 2 did? Write a reader letter!
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