Several financial experts have concluded that Norwegian taxes must be raised by up to 12 percent to counter the costs of the nation's increasingly aging population.
They say the revenue from the National Pension Fund - Global, (also known as the Oil Fund) will no longer be able to meet increasing costs.
Professors Alf Erling Risa and Erling Vårdal at the University of Bergen, along with a colleague from the University of Freiburg reached these conclusions. They have calculated that the more time that passes before these tax increases come into effect, the larger the increase will have to be.
- To balance the budget, we must either increase taxes or make cuts in welfare benefits, said the professors.
They point out that life expectancy is growing in Norway, which in turn results in growing retirement benefits and higher health service costs. These trends will only increase in the coming decades.
While most European countries will have to cut welfare in the coming years, Norway is partly sheltered from the worst scenarios. Nonetheless, funds from current oil production and future petroleum exploration, coupled with current levels of taxes, will not be able to meet increased costs.
Representatives from both Labour and the Socialist Left Party have earlier this summer called for raising taxes. The government will present its budget proposal on October 5th, in less than a month.
(NRK/Nettavisen)
Contributed by Thor Steinhovden
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