In the proposed 2025 national budget, the government suggests several changes to personal taxation. The maximum tax rate for wage earners remains at 47.4%, while the social security contribution is slightly reduced. The bracket tax is adjusted with increases for higher income levels, and the tax exemption limit is raised to NOK 100,000. Additionally, tax reliefs are introduced for the sale of surplus energy, rental income from private homes, and deductions for long-haul drivers and commuters. These changes aim to provide relief for individuals with low and medium incomes. Let’s take a closer look here.
Wage taxation
The maximum tax and contribution rate remains unchanged at 47.4% for the income year 2025. Reducing the National Insurance contribution by 0.1 percentage points provides slight relief for those earning less than NOK 670,000.
Tax on general income
The government proposes keeping the general income tax rate unchanged at 22% for the 2025 income year.
Tax Exemption Card
A proposition to increase the threshold for the tax exemption card from NOK 70,000 to NOK 100,000 has also been proposed.
Bracket tax 2025
The bracket tax is a progressive tax on personal income consisting of five levels. Due to expected wage growth, the government has proposed minor adjustments to the income thresholds for 2025.
The bracket tax is adjusted as follows:
- Steps 1 and 2 remain unchanged at 1.7% and 4.0%, respectively.
- Steps 3, 4, and 5 increase by 0.1 percentage points to 13.7%, 16.7%, and 17.7%, respectively.
- The thresholds for steps 1 and 2 are adjusted to expected wage growth, to NOK 217,400 and NOK 306,050 in 2025.
Proposition to the bracket tax table for 2025:
| Step | Salary income | Bracket tax rate |
| 0 | NOK 0 - 217 400 | 0,0% |
| 1 | NOK 217 400 - 306 050 | 1,7% |
| 2 | NOK 306 050 - 697 150 | 4,0% |
| 3 | NOK 697 150 - 942 400 | 13,7% |
| 4 | NOK 942 400 - 1 410 750 | 16,7% |
| 5 | Over NOK 1 410 750 | 17,7% |
National insurance contribution
In 2025, the national insurance contribution rates for wages and social security benefits will be reduced from 7.8% to 7.7%. This, along with the adjustments in the bracket tax, will provide relief for those with low to medium incomes. The lower basis limit for calculating the national insurance contribution should also be raised to NOK 99,650.
Travel deduction
The travel deduction threshold will increase from NOK 14,950 to NOK 15,600, and the upper limit will rise to NOK 100,880 in 2025.
The per-kilometer rate is also proposed to increase from NOK 1.76 to NOK 1.83 per km.
Commuters
The government proposes to remove the 24-month deduction period limit for commuters who live in barracks. This is because the commuter’s accommodation and work situation cannot be considered stable, even after two years in the same location.
Rental of own home and vacation property
The government proposes to increase the tax-free amount from NOK 10,000 to NOK 15,000 in 2025 to rent holiday homes and short-term rentals of private homes.
Long-distance drivers
The government proposes a further increase in the tax deduction for long-distance drivers and workers living in barracks. In addition, the daily allowance for meals will be increased to NOK 400 per day for absences of 24 hours or more.
Sale of garden and natural products
The government proposes changing the tax-free limit for selling garden and natural products from NOK 4,000 to NOK 10,000 in 2025.
Employee discounts and salary reporting obligations
The government proposes increasing the tax-free limit for employee discounts to NOK 10,000. Additionally, the threshold for reporting wage income is proposed to be raised from NOK 1,000 to NOK 2,000.
Deduction for savings in foreign pension schemes
The government proposes three changes to the rules for deductions on savings in foreign pension schemes:
- Removing the requirement for a connection to the EEA.
- Allowing individual members of a foreign pension scheme to opt into a Norwegian occupational pension scheme (OTP).
- Tightening the requirement concerning substantiality, clarifying that it must be assessed based on a regular income year.
These proposals do not affect the deduction itself and will involve elevating certain conditions from government regulations to the level of law.
Special deductions and personal allowance
- The personal allowance will significantly increase from NOK 88,250 in 2024 to NOK 108,550 in 2025.
- The minimum standard deduction will be reduced, with new limits of NOK 92,000 for wages/social security and NOK 73,150 for pensions.
The basis for this reduction is a broader restructuring where the personal deduction is increased.
- The special deduction for seafarers will remain unchanged at NOK 83,000.
- The deduction for trade union fees will increase by NOK 250 to NOK 8,250.
Wealth tax 2025
For the income year 2025, the following changes to the wealth tax are proposed:
- The basic deduction will increase from NOK 1.7 million to NOK 1.76 million (for married couples, NOK 3.52 million).
- The threshold for step 2 will increase from NOK 20 million to NOK 20.7 million.
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