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Fiscal and Tax Environment in Iceland

27 January 2010
by Ina Dimireva -- last modified 22 June 2010

Information about the fiscal and tax environment for international organisations, investing in Iceland.


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Tax System

New tax system has been implemented in Iceland since January 1st, 2010 after the government approved a series of reforms. Tax reforms consisted of restructuring of personal taxes from the current flat-rate of 24.1% to a three-tier system, along with increases in capital gains, VAT and tax-free exemptions.

  • Tax on earnings less than ISK200,000 per month: 24.1%.
  • Tax on earnings between ISK200,001 and ISK650,000: 27%.
  • Tax on salaries above ISK650,001: 33%.
  • The additional local government tax of 13% remains the same.
  • Capital gains tax: 18%

Doing Business in Iceland

Source: Invest in Iceland Agency

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