Trinnskatt

Trinnskatt, or step tax, is a progressive supplementary tax on personal income in Norway. It is levied on top of ordinary income tax and other state taxes, and is designed to increase the overall progressivity of the tax system.

The tax applies to personinntekt, which includes earned income such as wages and salaries, as well as certain pensions. A portion of the income is taxed at different rates depending on which bracket it falls into; income that lies within higher brackets is taxed at higher rates. The exact rates and the income thresholds for each bracket are adjusted annually by the government and published by Skatteetaten (the Norwegian Tax Administration).

Trinnskatt is separate from municipal and state income taxes and from taxes on capital income or wealth. It is typically collected through wage withholding by employers as part of payroll calculations, with adjustments made via the annual tax return if needed. The design aims to enhance equity by targeting higher levels of personal income.

Rates and thresholds for trinnskatt change over time as part of fiscal policy decisions. The system consists of multiple brackets, and the portion of income that falls into each bracket is taxed at the corresponding rate. The overall effect is to increase the tax burden progressively for higher earners, while lower earners pay little or no trinnskatt.

For further reference, see taxation in Norway, personal income tax, and Skatteetaten.