Norway proposes a statutory framework for the Pillar Two safe harbours in its 2027 budget bill

Norway’s 2027 tax and budget proposition, Prop. 1 LS (2026–2027), proposes a new statutory chapter devoted to Pillar Two safe harbours. The proposal would replace the Top-up Tax Act’s general safe-harbour delegation with separate powers covering both existing safe harbours and the OECD’s January 2026 Side-by-Side package. It also contains corrections to the joint-venture and deferred-tax provisions and consequential amendments to tax administration and payment legislation.

This is the legislative stage following the 4 June 2026 consultation, which closed on 3 August. The Ministry says no consultation responses justify changing the statutory proposals. The proposition is dated 2 October 2026. The Storting case record records submission on 7 October 2026 and shows committee consideration and both legislative readings as not yet completed. It remains a proposal for legislation: its text must be distinguished from an enacted amendment and from the regulations needed to give the safe harbours their detailed domestic content. (Chapter 7, §7.1.)

What changes against the existing framework?

The Ministry describes the existing Norwegian position as safe-harbour rules contained in regulations, supported by the general delegation in §5-7 of the Top-up Tax Act. Proposed chapter 8 would make the individual safe harbours visible in the Act itself. The replacement is therefore partly a change in legislative architecture. The QDMTT Safe Harbour and existing simplified-calculation framework should not be described as newly invented relief merely because they receive separate statutory provisions.

There is also a substantive implementation objective. The proposition states that the January 2026 OECD guidance had not yet been implemented in the Norwegian top-up tax rules. The new statutory powers would support that implementation, alongside the safe harbours already in place. The detailed conditions would still be established in regulations; the short enabling provisions do not themselves reproduce the complete OECD eligibility tests. (§§7.1, 7.2 and 7.4.1; proposed chapter 8.)

Proposed §8-1 preserves the elective character of the safe harbours: the reporting constituent entity may elect the relevant treatment when its conditions are satisfied. It expressly distinguishes the incentive safe harbour, under which relief is limited to top-up tax attributable to qualifying incentives for the financial year. That wording matters: eligibility for §8-14 would not necessarily eliminate all top-up tax in a jurisdiction. (Draft amendments to the Top-up Tax Act, Part I, §§8-1 and 8-10–8-20.)

The proposed Simplified ETR relief

The proposition’s explanation of the Simplified ETR Safe Harbour describes relief where the simplified calculation produces a loss or an effective tax rate of at least 15%. Its purpose is to reduce the adjustments and data demands of a full GloBE calculation. This description is an overview, rather than a complete domestic eligibility test: advisers will need the final implementing regulations before concluding that a particular group, jurisdiction or accounting data set qualifies. (§7.2.3; proposed §8-10.)

A 2027 budget proposal with intended 2026 effect

The budget year is not the proposed first year of application. Most amendments to the Top-up Tax Act would enter into force immediately, with effect from income year 2026 for financial years beginning after 31 December 2025. By contrast, repeal of the old §5-7 delegation would take effect on 4 January 2027. The related Tax Administration Act and Tax Payment Act amendments would enter into force immediately. These are proposed commencement rules, not confirmation that the changes are already operative. (§7.6 and the commencement clauses in the draft Acts.)