Threshold for acceptable tax planning illustrated with exchange of shares

Abstract

The purpose of this thesis was to try to see if one can draw a line between acceptable and unacceptable tax planning based on the application of the General Anti-Avoidance Rule (GAAR).

Traditional Norwegian legal method was applied in order to determine the legal regulation of anti-avoidance issues. I compared two binding advanced rulings on share exchanges from the tax authorities, analyzing the differences before and after implementation of the GAAR in 2020. I also looked at international perspectives and the political dimension of anti-avoidance to see their impact on the line between unacceptable and acceptable tax planning.

The analysis of GAAR’s evolution highlighted the necessity for a legislated general rule in 2020. Comparing two BFU cases revealed how anti-avoidance assessments have changed, with a post-implementation that focuses on individual rules’ legislative purpose. International aspects demonstrate that the line for unacceptable tax planning on cross-border transactions is influenced by a transaction's purpose and substance. The line between acceptable and unacceptable tax planning is challenging to draw. Increased legal practice that interprets the threshold for GAAR is likely necessary to create more clarity. However, a correlation between unacceptable tax planning and the application of GAAR can be seen when assessing anti-avoidance issues.