Nordic Insurance: Potential introduction of P&C VAT in Norway

Research evidence excerpt

Nordic Insurance: Potential introduction of P&C VAT in Norway

Global Research

23 June 2026ab

First Read

EquitiesNordic Insurance

Potential introduction of P&C VAT in Norway Europe including UK

Insurance

Qian Lu

Potential VAT charge on P&C insurance in Norway; 24th June key date to watch Analyst

Local Norwegian press (see here) reported that the Tax Commission is considering qian-za.lu@ubs.com

introducing VAT on P&C insurance, effectively removing the long-standing VAT +44-20-7567 4657

exemption and we note standard VAT tax rate in Norway stands at 25%. The Norwegian Will Hardcastle, CFA

system currently taxes insurance through a combination of explicit and implicit Analyst

mechanisms: (1) selected insurance-specific taxes (e.g. motor IPT) borne by customers; will.hardcastle@ubs.com

(2) VAT exemption on premiums, meaning insurers do not charge VAT but cannot +44-20-7567 9763

reclaim inputs VAT either e.g. VAT paid on IT services, creating embedded “VAT leakage” Nasib Ahmed, FIA

in both expenses and parts of claims; and (3) the financial activity tax, effectively a Analyst

payroll-based surcharge of c.5ppts on top of standard employer payroll tax rate, which nasib-za.ahmed@ubs.com

acts as a proxy for VAT. Economically, this means the sector already bears a mix of hidden +44-20-7568 8231

production taxes (VAT leakage, payroll surcharge). We note a formal publication of the Chloe Ryan

tax commission's final report is expected on 24th June 2026 (see here) which will be Associate Analyst

subject to political debate and could appear in 2027 tax reform plan if adopted. chloe.ryan@ubs.com

+44-20-7567 3505

VAT reclaim, financial activity tax relief and pass-through matter for earnings

If a full 25% VAT were applied on premiums, the gross shock would be large but the net