The legislation was misinterpreted for several years. The Storting now estimates that hired tax attorneys must work up to 1,000 hours to clean up.
On September 21, it was announced that the Storting will launch a comprehensive tax audit of the schemes of Storting representatives.
It came after Aftenposten’s revelations about the Storting’s traveler housing practice.
Politicians living more than 40 kilometers from the Storting receive a free Storting apartment paid for by the community.
But according to the Tax Administration, they must pay taxes on this benefit. The exception is if they have living expenses at home. The Storting management says they have not agreed. But they already got the information in 2003.
This is based on regulations anchored in the Tax Law, which has been adopted by the majority in the Storting.
The consequence is that Storting politicians may owe several hundred thousand crowns in taxes. The Storting may not have paid the employer’s contribution in accordance with the regulations.
Up to 1000 hours of legal work
The Grette Law Firm has been commissioned to review the Storting’s practice.
Aftenposten has had access to the mandate. It states that the attorneys “will provide an overview of all tax matters related to representative schemes, so that it can be cleaned up where there should have been a tax liability and to ensure that the tax liability is handled properly in the future.” .
– This is about the tax treatment of all schemes for representatives, not just traveler housing, writes the director of the Storting, Marianne Andreassen, in an email.
The audit will also investigate individual cases and have contact with the tax authorities on behalf of the Storting administration.
The Storting estimates that 800-1000 hours of assistance will be needed. Hourly rates are drastically reduced on documents Aftenposten has had access to.
The Storting: It is estimated to cost around two million crowns.
Grette will not indicate what hourly rates they will operate at on this assignment. In an email, partner Jacob Sverdrup Bjønness-Jacobsen writes that the prices should be considered “trade secrets”. Therefore, they are not available to the public.
The Storting also refers to trade secrets when they have gossiped about this. But Director Marianne Andreassen says the audit is estimated to cost a total of two million crowns, including VAT.
Aftenposten has been in contact with sources who are well aware of the pricing practice for this type of service. They say that the extensive work Grette faces here will be shared among the partners, ordinary lawyers and associates of the firm.
The partners of this layer of lawyers in Oslo charge a little more than 4,000 crowns per hour before VAT. Auxiliary lawyers can withdraw up to 2000 crowns. Permanent attorneys are somewhere in the middle.
We have done a careful calculation of averages. Our estimate is NOK 3,500 per hour. If it takes 1000 hours, the invoice for the tax cleaning can be NOK 3.5 million, not including VAT.
Andreassen says that a fixed price has not been agreed with Grette for the entire assignment.
– Hourly rates are used that are derived from the framework agreement we have with Grette, he says.
However, the Storting director says the hourly rates in the framework agreement are “significantly lower” than Aftenposten sources have estimated.
Coming after the Aftenposten cases
The audit will lead to a report that will be sent to the Storting administration. The deadline is set for November 30 this year.
– I am concerned that the work is done as quickly and efficiently as possible. At the same time, I am concerned that the work is carried out thoroughly and with the necessary professional competence, so that the tax is handled correctly, said the director of the Storting, Marianne Andreassen. in a press release on September 21.
It’s the storting which determines which tax laws that will apply to common people and companies.
Aftenposten has asked the Storting whether it is reasonable to expect ordinary people to be able to correctly interpret tax law when the country’s legislative institution needs the help of tax lawyers to make this happen.
The director of the Storting, Marianne Andreassen, does not reply to this. But he writes in an email that the background of the external tax audit is the cases that have arisen concerning passenger homes and the clarification of the rules by the tax authorities.
– With the tax audit, we have taken the consequence that the tax authorities believe that some of this has not been handled correctly. It is then implemented with a thorough review to ensure that everything is handled correctly for tax purposes.
The tax audit is in addition to a broader review of the Storting’s passenger housing regulations. It was implemented after the Aftenposten revelations and it looks at itself. regulations. Therefore, it will not answer if individual politicians have violated the rules of housing for travelers and what consequences it should have.