Telenor To Receive Tax Back, Says Norwegian Supreme Court

by Ulrika Lomas, for LawAndTax-News.com, Brussels

20 October 2006

It emerged this week that the Norwegian Supreme Court has ruled in favour of telecoms firm, Telenor over a tax deduction rejected by the country's tax authority in 2001.

A subsidiary within the group sold shares in Danish mobile phone firm Sonofon to another subsidiary at a loss, leading the tax authority to claim that the transaction was structured solely in order to illegally reduce Telenor's tax liability.

However, the Supreme Court on Tuesday asserted that the transaction was motivated by sound business practices, upholding the verdicts of two lower courts.

In a statement, Telenor announced that:

"As a consequence of this decision, Telenor will be repaid approx. NOK 2,414 million of previously paid corporate income tax. Telenor will receive a tax exempt interest compensation of approx. NOK 318 million and previously expensed, but not paid, late payment interest of approx. NOK 256 million will be reversed. Telenor will show a tax income of approx. NOK 2,414 million and a financial income of approx. NOK 574 million in the fourth quarter 2006."

Recommended