Employers say tax plan encourages Faroese to work abroad

The Faroese Employers’ Association says proposed tax changes would make it more attractive for Faroese people to work abroad than at home, KVF reported. It questions why the government would encourage overseas work when there is almost no unemployment in the Faroe Islands.

The government plans to increase the foreign income deduction and the per diem deduction. The bill is before the Finance Committee.

The association says people earning 500,000 kroner a year working onshore in Norway would have just under 4,000 kroner more per month after tax than if they worked in the Faroe Islands.

It also called it incomprehensible that contributions to Norway’s NAV social security system can be deducted from tax paid in the Faroe Islands, while Faroese social contributions cannot be deducted in the same way.