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PR(03)01: The EFTA Surveillance Authority clears amendment to the Norwegian “SkatteFUNN” scheme concerning tax deduction for R&D expenses


The EFTA Surveillance Authority decided today not to raise objections to an amendment to the Norwegian “SkatteFUNN” aid scheme.

By decision dated 25 September 2002, the Authority approved the “SkatteFUNN” aid scheme[1] which was introduced in the State Budget for 2002. The scheme implies that companies fulfilling certain conditions and requirements laid down in the Norwegian Tax Law and the Regulation to the Tax Law are entitled to obtain deductions in taxes. Tax deductions are reserved for R&D projects approved by the Research Council of Norway. Eligible R&D costs are limited to NOK 4 million (internal projects) or NOK 8 million (purchase of R&D services from R&D institutions).  Certain percentages of the eligible costs can be deducted from the company’s tax bill.

The original aid scheme was limited to smaller undertakings. The amendment implies that all enterprises may benefit from the scheme from 2003 onwards, irrespective of the size of the companies. Otherwise, the scheme is unaltered.

The annual loss in tax revenue is estimated to be approximately NOK 910 million (approximately EUR 124 million).

The extension of the scope of the scheme to include all enterprises does not change the scheme’s compatibility with the State Aid provisions of the EEA Agreement. The Authority has therefore decided not to raise objections to the scheme.

For further information, please contact Mr. Amund Utne on tel. +32 2 286 18 50 or Mrs. Alexandra Antoniadis on tel. +32 2 286 18 52.

[1]Dec. No. 171/02/COL regarding tax deduction for expenses of research and development. Published in Official Journal, C 10, 16.01.2003.

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