EFTA taxes Norway on car registration tax infringement / News / The Foreigner

The Foreigner EFTA taxes Norway on car registration tax infringement. European Free Trade Association (EFTA) officials are clamping down on what they see as Norway’s contra-EEA taxation rules regarding temporarily rented or borrowed vehicles. In the one of two letters, they deliver a so-called reasoned opinion about the practise of levying full registration tax. This applies to foreign-registered leased motor vehicles used by Norwegian residents in Norway.

norwayeu, efta, norwaycartax



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EFTA taxes Norway on car registration tax infringement

Published on Monday, 3rd December, 2012 at 16:45 under the news category, by Michael Sandelson   .

European Free Trade Association (EFTA) officials are clamping down on what they see as Norway’s contra-EEA taxation rules regarding temporarily rented or borrowed vehicles.



Paying the rent

In the one of two letters, they deliver a so-called reasoned opinion about the practise of levying full registration tax.

This applies to foreign-registered leased motor vehicles used by Norwegian residents in Norway.

The move follows a complaint EFTA received against Norway about the rules. Officials informed the Government of Norway about this in August 2009.

They declare that the tax on a vehicle registered in another EEA State, which also includes EU countries, Lichtenstein, and Iceland, can only be imposed where the vehicles are intended used mainly on Norwegian territory and on a permanent basis.

At the same time, the tax level must correspond to the duration of the use in Norway. They regard having to pay full registration tax without taking this into account is “disproportionate”, otherwise.

“Such an obligation is therefore in breach of the freedom to provide and receive cross-border services in the EEA.”

Norway’s government warned an adoption timetable might be impossible given the size of the matter, the cost implications for the state, and that it would have to be adopted by Parliament when the EFTA Surveillance Authority asked for this in June.

Further discussions with Customs and Excise later in the year for ideas and proposals for the amendment bred no results for the time being.

The EFTA Surveillance Authority dealt with a similar matter in 2008, again delivering a reasoned opinion. This led to a change in Norwegian regulations.

Something borrowed

This year, EFTA officials also sent Norway’s Ministry of Finance a letter of formal notice for failure to comply with its obligations under European Economic Area rules on free movement of capital.

The letter, again regarding registration taxation, is about Norwegian residents borrowing private motor vehicles registered in another EEA State, but for use in Norway.

It follows the EFTA Surveillance Authority opening an own initiative against Norway about this. Norwegian officials were informed of this in May this year.

“The Norwegian Government was invited to explain to the Authority whether or not it considers the Norwegian legislation and practice on registration taxation […] to be in compliance with the EEA rules on free movement of capital,” it wrote.

EFTA officials state in their subsequent letter of formal notice that EEA law stipulates, “Norway cannot impose a full registration tax without justification and without taking account of the duration of the use of such vehicles in Norway.”

According to the Authority, a letter of formal notice “is the first step in an infringement procedure against an EEA State. The Norwegian government has two months to express its views on the content of the letter.”

“A reasoned opinion is the second step in the infringement procedure. The Authority may bring the matter before the EFTA Court if Norway fails to take the measures necessary to comply with the reasoned opinion within two months.”



Published on Monday, 3rd December, 2012 at 16:45 under the news category, by Michael Sandelson   .

This post has the following tags: norwayeu, efta, norwaycartax.





  
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