Norway has the second highest GDP among Scandinavian countries ($485.3 billion; World Bank, 2023). Its economy is centered on gas and oil extraction, which accounted for 76.6% of exports in 2022. 

Furthermore, the unemployment rate is low compared to European data: 4% in 2024, according to the IMF and Eurostat. Therefore, the Norwegian market is attractive for initiating investments in the country. 

Economic opportunities within Europe 

Although Norway is not a member of the European Union (EU), it has been part of the European Economic Area (EEA) since 1994, along with Iceland and Liechtenstein. Consequently, due to these economic relationships, the country sends most of its exports to this international organization. In 2022, around 68.3% of goods were exported to the EU, while the United Kingdom ranked second with 21.4%. 

Norwegian tax system 

The Scandinavian country eases companies exercise due to its lax taxation framework. In the World Bank’s Doing Business ranking, the Norwegian state ranks as the ninth best country. However, in the ‘Paying taxes’ category, Norway lags to 34th place, behind Sweden and Finland. 

Norwegian CIT and VAT 

Main taxes levied on companies operating in Norway include Corporate Income Tax (CIT) and Value Added Tax (VAT). The general rate of the first, a 22%, is the highest in Northern Europe, although CIT is surpassed by the Netherlands and the United Kingdom. Furthermore, the rate varies for certain financial institutions because the withholding increases up to 25%. 

As a result, VAT is maintained at a 25% retention rate, but this tax includes reduced rates: the tax is 15% for food, 12% for public transportation, and there are exemptions for books and newspapers. 

Payroll taxes 

The Norwegian progressive Income Tax return varies annually. Thus, the 2025 graduated table is as follows: 

The Norwegian government seeks to maintain the social welfare that characterizes the nation. For this reason, both workers and employers must allocate a portion of the gross salary to Social Security. This system is internationally recognized, as the OECD ‘Better Life Index’ ranks Norway as the country with the best welfare. 

The rate collected from companies to Social Security changes regarding employer’s region. Therefore, urban areas approach 14.1% withholding, although some rural and isolated regions may provide exemptions. However, employees must apply an 8.2%, which is the general tax rate. 

Conclusions 

Norway’s strategic location in Europe facilitates seamless collaboration with the European Union. Consequently, in 2024, more than 33% of the EU’s gas imports originated from this Nordic nation. The country’s stability, coupled with a robust oil and gas market, positions it as a viable investment prospect. 

Therefore, if you are interested in the region, rely on Auxadi to tax compliance services in Norway and on over 50 jurisdictions distributed among EMEA, America and Asia. 

About Auxadi 

Auxadi offers international accounting, tax, payroll, and Corporate Legal Services to multinationals and funds in over 50 jurisdictions, with 22 wholly-owned subsidiaries worldwide. Our experience and global presence allow us to provide tailored tax solutions, ensuring efficient management in compliance with local tax regulations.    

Contact us today and discover how we can facilitate your international expansion.