Let G be a finite group. For a G-ring A, let Pic G (A) denote the equivariant Picard group of A. We show that if A is a finite type algebra over a field k then Pic G (A) is contracted in the sense of Bass with contraction H 1 et (G; Spec(A), Z). This gives a natural decomposition of the group Pic G (A[t , t −1 ]).