Norway's Center Party is pushing for substantial tax reductions in ongoing government budget talks. The agrarian-focused party wants to cut food VAT from 15% to 10% and implement this change starting autumn 2026. Party leader Trygve Slagsvold Vedum confirmed the timeline for the proposed tax reduction.
The food tax cut forms part of a broader package of tax relief measures. The Center Party also seeks lower fuel duties, increased travel deductions, and income tax cuts for everyone earning under 1 million kroner annually. Combined, these tax and duty reductions amount to 4.2 billion kroner in next year's state budget.
These proposals come on top of other substantial spending demands. The party wants 6.5 billion kroner for strengthened municipal finances, half a billion for police services, and 1.2 billion extra for hospitals. Additional requests include a billion kroner for county roads, halved express boat fares, and continued broadband expansion.
Financial policy spokesperson Bjørn Arild Gram estimates the total package ranges between 15 and 20 billion kroner when fully implemented. This represents one of the most comprehensive budget proposals from a support party in recent Norwegian politics.
The Center Party previously floated similar tax cuts during revised national budget discussions but failed to secure approval. Their current push comes amid ongoing debates about Norway's high cost of living, particularly in rural areas where the party draws much of its support.
Norwegian budget negotiations typically involve intense bargaining between government parties and their support partners. The Center Party's substantial demands test the government's fiscal discipline while addressing concerns about household expenses. The outcome will signal the government's priorities between tax relief and other public spending needs.
International observers note that Norway maintains relatively high VAT rates compared to some European neighbors. The proposed food tax reduction would align Norway more closely with Sweden's 12% food VAT rate, though still above Denmark's current level.
What makes these demands particularly noteworthy is their timing. Norway's economy faces uncertainty despite its substantial sovereign wealth fund. The government must balance immediate tax relief against long-term fiscal sustainability, especially with changing energy revenues.
The negotiations outcome will affect both Norwegian households and the country's economic direction. Successful implementation could ease cost-of-living pressures but might require compromises elsewhere in the budget.