OSLO: European Free Trade Association Surveillance Authority (EFTA) has made various amendments to the Special tax system for shipping, exempting the corporate tax and imposing a tonnage tax
Under the STSS, shipping income is exempted from corporate tax, and only a tonnage tax related to the ship’s tonnage is imposed. The tax reduction is intended to give an incentive for shipping companies to improve the environmental standards of their ships. Depending on an environmental rating of the ship, the standard tonnage tax may be reduced by between 2.5 percent and 25 percent.
A ship’s environmental rating is based on its air emissions, operational discharge from the ship into the sea, and its efforts to prevent accidental discharge into the sea.
The amendments, now approved by EFTA Surv, among other things, add CO2 emissions to those air pollutants measured (currently COx and NOx) to assess a ship’s air emissions, and add a new criterion on the shipping company’s implementation of an environmental accounting system for ships.
EFTA Surv found that the differentiated reduction of the standard tonnage tax within the STSS, based on the revised environmental criteria, remains compatible with the state aid rules of the EEA Agreement.
