Norske Skog, Halden Municipality Agree on Property Taxes, Port Areas

Norske Skog and Halden municipality, Norway, have agreed a settlement for the valuation of the mill assets at Norske Skog Saugbrugs in Halden. For years there has been an ongoing dispute both within and outside of the criminal justice system between Norske Skog and Halden municipality over the size of the property tax. The parties have now signed an agreement whereby the tax base is agreed for coming years and for a settlement of previous years. As part of the settlement agreement, the parties agree to change the agreement related to the development of the southern port area of Sauøya to Norske Skog Saugbrugs.

 

The parties have agreed upon the principles for tax valuations of the assets from 2015 and beyond. The tax basis from 2015 and beyond will be NOK 1.7 billion. Norske Skog Saugbrugs will, until the next tax valuation in 2019, pay NOK 12.0 million annually in property taxes to Halden municipality. Norske Skog Saugbrugs has paid NOK 15.6 million annually in property taxes. Norske Skog Saugbrugs will be refunded NOK 8.6 million in excess property taxes paid for prior years. 

 

The southern port area of Sauøya will remain in Norske Skog Saugbrugs’ possession. The municipality previously entered into an agreement with Saugbrugs in 2007 and 2010 for the development of Sauøya for port activities with a clause to return the area to Saugbrugs if the plans were not implemented. Halden municipality will have the right of first refusal at market price if Saugbrugs chooses to sell the port areas to others.

 

CEO of Norske Skog Sven Ombudstvedt is pleased with the agreement, "Norske Skog is fighting to keep costs down every day. Property taxes are an additional burden many of our competitors do not have. We are satisfied that the municipality has approved our value assessment of the mill."