State set to raise fuel taxes
Finance Minister Kristin Halvorsen isn't showing any sympathy for Norwegian motorists hit by record high fuel prices. Instead, her ministry will raise fuel taxes yet again on July 1st.
 Finance Minister Kristin Halvorsen refuses to drop plans to further raise Norway's already-high fuel taxes. PHOTO: MORTEN HOLM/SCANPIX Lars-Erik Schjerpen had to pay NOK 13.90 a litre at an Esso station in Oslo on Tuesday, and wasn't happy about it. PHOTO: FOTO: INGAR STORFJELL |
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Norwegians are now paying as much as NOK 14 a litre for the lowest grades of unleaded gasoline (just over USD 11 a gallon). While that reflects record high oil prices, Norway's traditionally high fuel taxes are also a major component.
The policy has always been aimed at discouraging use of private cars. The problem for many Norwegians, especially those living in rural areas, is that public transit isn't always a viable option. And many motorists who depend on their cars are feeling the strain. So is the transport industry, which has warned of bankruptcies because of its higher fuel costs.
That hasn't stopped Halvorsen, head of the Socialist Left party (SV), from rejecting recent pleas to lower fuel taxes because of high oil prices. Instead, she's moving forward with higher taxes that are expected to boost prices at the pump to at least NOK 15 per litre (USD 12 a gallon). Some market analysts think fuel prices will hit NOK 17 by year-end.
That set off a grass-roots protest earlier this week, which Halvorsen is ignoring. She claims that fuel taxes are "a relatively small" portion of Norwegians' overall tax burden, suggesting that most can afford them.
Asked by newspaper Aftenposten whether oil-producing Norway should rank as having Europe's most expensive fuel, Halvorsen claimed that it wasn't, given Norway's higher standard of living and income levels.
The Progress Party, Norway's most conservative, is the only political party in parliament calling for lower fuel taxes. It also has attracted the most support in recent public opinion polls.
Nina Berglund
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