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Government Doubles Back on Taxing Fishing

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Government Doubles Back on Taxing Fishing

Fishermen in Grímsey, Iceland

Fishermen in Grímsey, North Iceland. Photo: Golli.

A bill which proposes lowering taxes on the fishing industry has received criticism from the opposition, RÚV reports. The bill proposes cutting the industry’s taxes by nearly ISK 2 billion ($19m/€16m). The bill appears to reflect a policy change on the part of Prime Minister and Left-Green Party Chairperson Katrín Jakobsdóttir, who stated in an interview last October she would work toward raising taxes on the industry.

Katrín Jakobsdóttir was interviewed by RÚV last October shortly before becoming Prime Minister. She stated at the time that higher taxes on the finishing industry would be one strategy for funding improved healthcare and education. “I think it’s possible to raise them fairly without having a negative effect on the industry in the country,” she remarked.

Iceland’s current laws on taxation of the fishing industry expire this coming fall. The bill was introduced in parliament last Thursday by a majority of the Industrial Affairs Committee, chaired by Left-Green Movement MP Lilja Rafney Magnúsdóttir. It is intended as a provisional measure while the Minister of Fisheries prepares a comprehensive bill on taxation of the industry.

Minister of Fisheries Kristján Þór Júlíusson expressed reserved support of the bill, stating he believes taxes on the fishing industry are too high compared to gross profits and costs.

Indriði H. Þorláksson, former Internal Revenue Director, stated there are no grounds for a reduction in taxation on fishing. He pointed out that over 80% of fishing licenses are in the hands of industry giants whose yearly profits add up to billions of krónur.

Social Democratic Alliance Chairman Logi Már Einarsson called it scandalous that the government would prioritise lowering taxes on the industry, and opposition parties have requested the bill be removed from the agenda.

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