Jets: - Norwegian SME companies need better tax framework
(Thursday, March 31, 2011)
While visiting the Jets group on Monday, March 28th, State Secretary Rikke Lind of the Ministry of Trade and Industry along with local Labour Party representative Egil Ekhaugen were given important input on Norway's tax policies by the management at Jets. Lind was first introduced to a number of examples on the advantages provided by the water saving sanitary technology made by Jets, before being challenged on the issue of unfair taxation of Norwegian companies not listed on the stock exchange - such as Jets.
Great opportunities for Norwegian environmental technology
- We are seeing more and more that the opportunities for Jets vacuum sanitary systems are increasing world wide, not least because of their ability to conserve water. With ever growing populations combined with a higher standard of living, a growing number of people are requiring better sanitary standards. This in turn means that water consumption goes up - unless Jets vacuum systems or another environmentally friendly sanitary technology is used. We reduce the amount of water and sewage to and from toilets by 80-90%, and many of our customers experience almost unbelievable resource savings when they start using Jets technology. As these global challenges are starting to get more recognition, a very large market with amazing potential for our company is opening, says acting Jets CEO Kåre Haddal.
Discrimination against small businesses
While Haddal is very clear on the opportunities that lie ahead, he is equally clear on the pitfalls that are in the way of Norwegian small and medium-sized businesses not listed on the stock exchange. Under the current government, corporate tax has increased rapidly for these unlisted companies, despite the fact that the value - and taxation - of larger, listed companies has declined because of the recent financial crisis. This is unfortunate for SME companies. As such, Norwegian tax policy was a key element in the talks between Jets and the State Secretary.
Long-term ownership punished
- Lind argued that the government's corporate tax earnings have been reduced, which is actually correct when we look at the total monetary amount. The problem is that the reduction stems from the large, listed companies which through reduced stock value and taxation have yielded less tax for the government, plain and simple. For the SME companies, the completely opposite is true. The tax level for SME companies has been increased to a level where new small businesses risk having to pay large amounts of money in tax on their assets, prior to having earned the money to pay that tax with! In other words, the government rewards business owners who take all or most of the profits from the company and pay them out as dividends, and punishes long-term owners who allow the funds to remain in the company to ensure continuous growth in the long run, Haddal points out.
Despite a healthy tax policy debate, the State Secretary's visit at Jets was a very positive one. Lind was obviously impressed by what Jets has achieved with its products internationally since the company was founded 25 years ago. Acting Jets CEO Kåre Haddal appreciated the opportunity to air his views on the government's business politics, and hopes that the input from Jets will be considered by the Ministry of Trade and Industry.
Top picture: the State Secretary's visit at Jets was concluded in the Jets laboratory, where the full-scale piping simulator with transparent piping clearly showed the advantages and possibilities of using vacuum sanitary systems. (From left: Jets Public Relations Officer Jan Kenneth Steinsåker, Jets Board Chairman Anne Breiby, Kjell Ulla from Jets R&D, State Secretary Rikke Lind, Labour Party representative Egil Ekhaugen.)
Phone: +47 - 91 58 01 42
Jan Kenneth Steinsåker
Public Relations Officer
Phone: +47 90 99 07 79
The Jets™ group
Since the late 1980s, the Jets™ group has supplied the world's leading products in maritime sanitary technology. Today the group has more than half the world market for vacuum sanitary systems in this segment.
The technology has also been used very successfully onshore, and has vast potential for growth in land based markets where considerations like environment, water savings and water costs are growing ever more important.