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Iceland

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About

Iceland

Capital
Official languages
Population 
Currency

ISO 4217

Reykjavík

Icelandic

364,134 (as of July 2020)

Icelandic Krona

ISK

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Economy

Iceland has a strong and stable economy, with a GDP of $25.2 billion in 2019. This is a 3.2% increase from 2018, and the country is expected to continue to grow in the coming years. The unemployment rate in Iceland is low, at just 2.7%, and the inflation rate is also low, at 1.7%. Iceland has a strong export market, with exports totaling $7.2 billion in 2019. The main exports are fish and fish products, aluminum, and tourism. Iceland also has a strong tourism industry, with over 2 million visitors in 2019. The country has a strong banking sector, with the three largest banks controlling over 80% of the banking sector. Iceland also has a strong energy sector, with geothermal and hydropower providing over 90% of the country's electricity. Overall, Iceland has a strong and stable economy, with a bright future ahead.

Taxation



Iceland has a progressive tax system that applies to both individuals and corporations. The tax rates vary depending on the level of income earned or profits made. Here is an overview of the taxation system in Iceland:


Corporate Taxation:

- The corporate tax rate in Iceland is a flat rate of 20%.

- Corporations are required to file their tax returns by the end of March each year, and tax payments are due on the same date.

- There is also a municipal tax that applies to corporations, which ranges from 12% to 18%, depending on the municipality where the company is located.

- Corporations are required to pay a minimum tax each year, regardless of their profits. The minimum tax is calculated based on the company's assets, and the rate ranges from 0.1% to 0.4%.


Personal Taxation:

- The personal income tax system in Iceland is progressive, with tax rates ranging from 37.3% to 46.24%.

- The tax year in Iceland runs from January 1st to December 31st.

- Individuals are required to file their tax returns by the end of March each year, and tax payments are due on the same date.

- There are also several deductions and tax credits available to individuals, including deductions for mortgage interest payments and tax credits for charitable donations.


Tax Payment Process:

- Tax payments can be made online or in person at a bank.

- The Icelandic tax authorities provide taxpayers with a tax return form each year, which can be completed online or on paper.

- The tax return must include information about the taxpayer's income, expenses, and deductions for the previous year.

- The tax authorities will then calculate the taxpayer's tax liability and send them a tax assessment.

- Taxpayers can choose to pay their taxes in a lump sum or in installments throughout the year.


In summary, Iceland has a progressive taxation system for both individuals and corporations. Tax returns must be filed by the end of March each year, and tax payments are due on the same date. Taxpayers can make their payments online or in person at a bank.

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