Norway has a tax system that rewards property ownership and punishes productive investment. We want to flip that.
Too much Norwegian capital is locked in housing. Too little flows into businesses, innovation, and job creation. Our tax proposals are designed to redirect capital from passive ownership to active use — while making it easier for ordinary people to build financial security.
Norwegian tax policy makes housing the most tax-favoured investment in the country. Capital gains tax on home sales is zero. The result is that capital is parked in secondary dwellings because it is the safest tax-free investment — not because people want to live there. It drives up housing prices, it prevents entrepreneurs from reinvesting gains in new businesses, and it keeps young people out of the housing market.
The Universal Capital Account works like a share savings account, but for all capital — housing, shares, businesses, everything. Gains from sales can be reinvested tax-free. Tax is only triggered when you withdraw the money for consumption.
Today we have share savings accounts, BSU, IPS and a number of other schemes — each with its own rules and limitations. The capital account replaces all of this with one principle: gains that are reinvested are tax-free; gains that are consumed are taxed.
Sell a business, start a new one — without paying half the gain in tax. The capital account makes serial innovation possible.
Housing prices ease when the tax advantage disappears. Fewer secondary dwellings as investment objects means lower prices in the market.
A higher wealth tax exemption threshold (see below) means working capital in the business is not penalised.
Capital flows to productive investments instead of sitting in the third investment flat.
Sweden introduced the ROT deduction (Repairs, Conversion, Extension) in 2009. The result: a sharp reduction in undeclared labour, more work for legitimate tradespeople, and better-maintained homes. We want the same for Norway.
The ROT deduction lets homeowners deduct a portion of labour costs for renovation and maintenance work from their tax bill. Only licensed, tax-paying businesses qualify. The effect is threefold: it makes legal work cheaper relative to black-market alternatives, it creates demand for skilled tradespeople, and it improves the housing stock.
Norway has a significant problem with undeclared work in the construction and renovation sector. The ROT deduction attacks it from the demand side — by making it economically rational to hire properly. Swedish data shows the model works.
Norwegian households have roughly 80% of their wealth in housing. That is not diversification — it is a systemic risk. And it is a direct result of tax policy that makes property the most tax-efficient investment.
Property is taxed at a fraction of its market value. Mortgage interest is deductible. Rental income from secondary dwellings is lightly taxed. Meanwhile, investing in a business or buying shares comes with higher effective tax rates. The signal is clear: buy property, not productivity.
We want to gradually equalise the tax treatment of property and other investments. Not by making property dramatically more expensive, but by making alternatives equally attractive. The Universal Capital Account is the carrot. Slowly adjusting property tax advantages is the long-term correction.
The Norwegian tax system should make it worthwhile to work, to save, and to invest in businesses that create jobs. Today, the marginal tax on labour income is among the highest in the OECD, while passive property ownership is gently treated.
We propose a rebalancing: lower the effective tax on earned income at the margin, strengthen incentives for productive savings through the Universal Capital Account, and close the gaps that let passive ownership outperform active investment.
This is not a low-tax ideology. Total tax revenue need not fall. It is about what we tax and how — shifting the burden from work and enterprise toward passive capital gains and undertaxed property. A tax system that rewards contribution, not just ownership.
For the young saver: You can start investing in your twenties through a Universal Capital Account with no tax on gains until withdrawal. Over 30 years, the compounding effect is enormous compared to today's after-tax returns.
For the homeowner: You can deduct labour costs when you renovate your bathroom or replace your roof — as long as you use a licensed tradesperson. Legal work becomes competitive with black-market prices.
For the small business owner: A tax system that no longer penalises your investment relative to a buy-to-let property means more capital available for growth, hiring, and innovation.
These are not abstract principles. They are concrete changes that redirect capital from where it sits idle to where it creates value — for individuals and for society.
| Reform | Effect (NOK bn/year) |
|---|---|
| Capital gains tax on home sales | +8 |
| Eliminate documentation fee | −10 |
| Raise wealth tax exemption threshold | −6 |
| Universal capital account | −2 |
| Tax deduction for tradesperson services | −6 |
| Of which: reduced black market economy | +3 |
| NET | −13 |
Introduced in Phase 3 (years 3–5) of the implementation plan, when savings from earlier phases free up room.
Housing security — fixed rates, limited debt liability and faster debt restructuring — is closely linked to the tax reforms.