government, Norway, tax, budget, 2018, airline, points, loyalty, employment, employee, declare

Norway tax targets airline bonus points

The Norwegian government seems determined to launch more taxes on employees’ perks.

In a revised draft of the 2018 national budget, the Norwegian government is listing a number of changes in the tax rules for employees, including perks and gifts they receive from employers and customers.

Estimates show that overall the new rules could to lead to NOK 115 million (€12 million) in the increased tax burden for workers in Norway.

One key change in the new rules is that the employer will be responsible for reporting employee benefits utilised to the tax authorities, as opposed to it being the person receiving the gift having to report it and deduct taxes.

Alongside taxes on free newspapers and food paid when staff work overtime, the measures making it “harder to be an employer and more expensive to be employed”, in the words of one insider quoted by free-trade website Fri Fagbevegelse, include a provision that people will have pay tax on airline bonus points.

Taxed miles
Airline tickets have been taxable in Norway in the past, although it is rumoured that few brought them up on their tax returns, Fri Fagbevegelse writes.

For example, taxes must be paid on bonus points that are earned on business trips and spent on a private holiday.

What’s new is that the employer is now responsible for reporting the employees’ private use of earned bonus points from business travel in connection with flights, hotels, credit cards and so forth.

One solution, Fri Fagbevegelse proposes, may be to include a requirement in employment contracts where employees must inform their employer whenever this happens. Another solution could be to ban altogether the private use of bonus points earned on company business travel.

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