12 February 2010

12 February 2010      Tax law. Tonnage tax. Retrospective effect. ECHR.

The case concerns an amendment to the tonnage tax scheme that was introduced in 1996. According to the scheme, shipping income was “exempt from tax”, but untaxed profits were taxed upon distribution to shareholders or exit of the company from the special tax system. A majority of the Supreme Court held that the tax assessment of the shipping companies must be set aside because the transitional rules in the Act of 14 December 2007 no. 107 Part X violated the prohibition against retroactive legislation in Article 97 of the Norwegian Constitution. The majority emphasised that there were no strong public policy reasons why the legislation should be given retroactive effect and it was therefore unnecessary to consider the provisions on protection of private property in Article 1 of Protocol 1 to the ECHR. Dissent 6-5.

Reference:  HR-2010-258-P, case no. 2009/1575 and case no. 2009/1663, civil appeal against judgment.