28-05-2025
Norway To Randomly Select 100,000 Millennials, Gen Z For Tax Cuts
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Norway plans to randomly select 100,000 people born between 1990 and 2005, covering both millennials and Gen Z, to receive an annual tax cut of $2,700 for several years.
Newsweek has reached out to Norway's Ministry of Finance via email for comment.
Why It Matters
The Norwegian government is currently exploring ways to boost participation in the labor market, following rising social security payments and a shortage of workers across multiple sectors, as per Reuters.
President Donald Trump shakes hands with Norwegian Prime Minister Jonas Gahr Store during a meeting at the White House in Washington, D.C., on April 24, 2025.
President Donald Trump shakes hands with Norwegian Prime Minister Jonas Gahr Store during a meeting at the White House in Washington, D.C., on April 24, has the largest sovereign wealth fund (SWF), which is a state-owned investment fund, in the world, an amount of $1.8 trillion. Tens of billions are spent from the fund each year.
What To Know
The initiative has been proposed by Norwegian Finance Minister Jens Stoltenberg and Labor Minister Tonje Brenna.
If passed, it will offer tax cuts for around 8 percent of workers who are between 20 and 35 years of age, spanning older millennials into younger Gen Z.
The initiative aims to measure if lower taxes could drive higher employment. If it is passed by parliament, the group of 100,000 people would be part of an academic study.
Those with tax cuts would then be compared to those without.
It is estimated that the measure would cost around $49 million annually, according to Reuters.
In 2024, the country's former Finance Minister Trygve Slagsvold Vedum along with Brenna raised Norway's Tax Free Allowance to $9,500 (100,000 NOK). In an interview with the outlet NRK at the time, Vedun said: "We want young people to be able to earn up to 100,000 NOK without being burdened by taxes. Therefore, we are raising the Tax-Free Allowance from 70,000 NOK to 100,000 NOK. This means that more young people will be able to work without paying any taxes."
Norway is not the only European country to look at tax breaks for young people. Portugal has introduced a comprehensive tax relief program targeting individuals aged 18 to 35. Under this scheme, young professionals earning up to €28,000 ($32,000) annually are exempt from income tax in their first year of employment.
France meanwhile offers the "impatriate tax regime," which provides tax benefits to individuals returning to France after working abroad.
What People Are Saying
Norway's Finance Ministry, in a statement to Reuters: "This will give us strong data on whether such a tax deduction really boosts youth employment, and on how much more or less those who are already in a job will work."
What's Next
The initiative is projected to last three to five years. Whether it passes in parliament remains to be seen.
