International Institute for Sustainable Development (IISD) researchers say Norway has nine different schemes.
Six of these subsidies poured 25.5 billion kroner into the oil and gas industry’s money well in 2009. State agriculture subsidies cost 13.3 billion kroner-a-year.
Revised tax procedures in 2004 also allowed many non-producing companies to deduct exploration costs from their annual returns. Experts say the Norwegian state is a successful business enterprise.
"This is good business"
British oil analyst Philip Lambert said last month, “This tax concession has cost the state USD 18 billion, but has resulted in earnings of USD 48 million in just seven years.”
“The cost of the new tax scheme is small compared to the benefits that society gains,” Norwegian Oil Industry Association (OLF) information officer Roger Pedersen tells Aftenbladet, “I would have used the word deduction, not subsidies. This is good business for the state that wants to increase Norwegian Continental Shelf exploration activity.”
According to the IISD, subsidy cuts would also breed emission cuts, but would mean fewer jobs and smaller incomes for the Norwegian state.
“Removing investment deductions valuing 20.8 billion in 2009 and exploration refunds worth 4.0 billion would decrease the state's tax revenues from the petroleum sector by 8.1 percent and reduce employment in the oil, gas and supply sectors by 0.5 percent. Removing these subsidies would also have had a positive impact on national greenhouse gas emissions, which would decline by 1.5 percent,” states a press release.
The Organisation for Economic Co-operation and Development (OECD) calculates farmers receive annual support worth between 7 and 9 billion kroner.
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