On 27 February 2020, the Norwegian Ministry of Finance issued a public consultation paper introducing the withholding tax (WHT) on interest, royalty and certain lease payments to controlled parties.
The withholding tax on interest payments will apply to related parties that are residents in “low-tax jurisdictions”. For royalties, withholding tax will apply to all payments to related parties regardless of whether they are located in a low tax area. The proposed tax rate is 15% on the gross amount, unless an applicable income tax treaty provides a lower rate of withholding.
The Ministry proposes that the rules shall be effective from 1 January 2021. Comments to the proposal must be submitted by 27 May 2020.
