The recently-elected Faroese government has issued a proposal to adjust the revenue tax for the salmon farming industry, effective from 1 August 2023 if passed as is by parliament.
This new proposal builds on the same principles as the previous government’s proposal in which different tax rates should be applied, dependent on the difference between the monthly FishPool Index prices and the annually assessed average production cost for the Faroese salmon industry.
However, in the new proposal, the tax rates continue beyond the 10% proposed from the previous government (now opposition) and stretch to 20% when the FishPool Index prices exceed industry production cost of DKK40 per kg.
In total, nine tax rates are proposed between 0.5% and 20%. The average production cost for 2021 is proposed as baseline, which is set to be DKK39.15 (around NOK 59 per kg). Hence, a FishPool Index price exceeding around NOK 119 per kg would result in the maximum tax rate of 20%.
The proposal is currently out for hearing with the salmon farming industry until 16 March 2023.
Meanwhile, the opposition has also reproposed its original proposal put forward to parliament in September 2022, but which was not up for voting before the election in December.
