A bracket tax payable to the State replaced surtax on high incomes from the start of the 2016 income year. Bracket tax is a progressive tax on gross salary and other personal income.
The bracket tax for personal taxpayers is calculated based on the individual's salary income and other corresponding incomes which replace salary income, such as sick pay, work assessment allowance, disability benefit and pension.
Bracket tax consists of four steps. You will not pay any bracket tax on the first NOK 174,500 of your personal income.
|Income between NOK 0 - 174,500||No bracket tax|
|Step 1||Income between NOK 174,500 – 245,650||1.9% bracket tax|
|Step 2||Income between NOK NOK 245,650 – 617,500||4.2% bracket tax|
|Step 3||Income between NOK 617,500 – 964,800||13.2% bracket tax*|
|Step 4||Income over NOK 964,800||16.2% bracket tax|
*residents of Finnmark and Nord-Troms 11.2%
About the steps
Bracket tax uses rising tax rates, split between four steps, where the bottom two steps are triggered at lower income levels than was the case with surtax. The first stage concerns income in the lowest income band, while the other stages concern income above this. The rates and income levels are the same regardless of whether you are assessed under tax class 1 or whether you are assessed jointly with a spouse under tax class 2.
The new bracket tax is linked to the reduction in tax on general income with effect from the 2016 income year. General income comprises all types of taxable income with the deduction of all deductible expenses.
The special reduction in the surtax rate which residents of Finnmark and Nord-Troms previously received has been continued through the setting of the tax rate for step 3 to 11.2% for residents of this region.