Iceland Updates 2017 Personal Income Tax Brackets, Rates

By Molly Ward

Income tax changes in Iceland, including a tax bracket reduction from three brackets to two, was published Dec. 27 in the Icelandic Official Gazette.

The new personal income tax rates, which include municipal rates, for the 2017 year are:

• 36.94 percent (decreased from 37.13 percent) on the first 10,016,488 krona ($87,274) and • 46.24 percent (decreased from 46.25 percent) above 10,016,489 krona

The middle income tax bracket, previously at 38.35 percent for 2016, will be eliminated while the income tax threshold will decrease to 10,016,488 krona from 10,043,880 krona ($87,512).

In a related notice, the Ministry of Finance noted that social taxes will remain unchanged.

To contact the reporter on this story: Molly Ward at mward@bna.com

To contact the editor on this story: Michael Baer at mbaer@bna.com

For More Information

The official gazette notice can be found in Icelandic at https://www.stjornartidindi.is/Advert.aspx?RecordID=634e5676-eaf2-4ef1-b500-f2f79c16f1d1.

The Ministry of Finance notice can be found in Icelandic at https://www.fjarmalaraduneyti.is/frettir/skattthrepum-faekkad-i-tvo-personuafslattur-haekkar-um-19-og-skattleysismork-haekka-um-24.

More information on payroll issues in Iceland can be found in the Iceland country primer.

Copyright © 2016 The Bureau of National Affairs, Inc. All Rights Reserved.