Norway-based salmon famer Nova Sea is pressing ahead with its plan to build a new NOK 2 billion (€174.5 million/$187.2 million) salmon plant in Lovund, Norway, after putting the project on hold in the wake of the passage of Norway's controversial new 25% tax on the country's fish farmers.

Work on the plant is slated to begin next April with the first salmon harvest in 2026, the company said in a statement Tuesday.

"The old facility is outdated and cramped," said Nova Sea CEO Tom Eirik Aasjord. "We must have a new harvesting plant to keep up with developments in the industry."

On Sept. 29, the day after the government announced the introduction of ground rent tax in aquaculture, Nova Sea announced it was putting the investment in the new plant on hold.

The company will increase harvesting capacity considerably with the new facility and, depending on the level of activity, the plant will create between 10 and 40 new jobs.

Salmon Tax Agreement

The agreed salmon tax proposal is based on the model put forward by the government, with the following changes:

  • The effective tax rate is reduced from 35% to 25%.
  • The valuation discount in wealth tax is increased from 50% to 75%.
  • The host municipalities and counties are guaranteed a higher income from the Aquaculture Fund for 2023.
  • In addition, several request proposals are put forward to strengthen the environmental profile and contribute to technology development.

The investment of NOK 2 billion (€174.5 million/$187.2 million) is the largest single investment ever seen in the Luroy municipality.

Earlier this summer, Nova Sea-owned smolt producer Helgeland Smolt also said it will begin construction of its new NOK 1 billion (€87.2 million/$93.6 million) production facility in Kilvika in Meloy, Norway.

"We have now gone through a year of great uncertainty as a result of the ground rent tax," said Aasjord. "But we want to develop our local community, provide work for our suppliers, have good quality in the fish we sell, and take good care of our employees."

"It is far more important to us than the prime rate, and we are incredibly happy to have a board that chooses to invest so aggressively in a time where there is still a lot of uncertainty."

However, Aasjord noted, the investment is a big financial burden for the company now that the tax has been introduced.

"Now we are making a formidable boost to secure both the farming industry and the supplier industry in the region. We expect the politicians to see the benefit in being part of the journey ahead."

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