Iceland vs Finland
Tax Rate Comparison
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๐ฐ Personal Income Tax Calculator
Enter your income to see your estimated annual tax liability in each country โ side by side.
๐ฎ๐ธ Iceland โ Municipal Income Tax
Iceland's 69 municipalities set their own local income tax rates, ranging from ~12.44% to ~14.52%, averaging ~14.45%. This is added to the national income tax. The combined effective rate for most earners is about 36.94% (national + municipal). Iceland has no inheritance tax on direct heirs. Real estate transfer tax (stimpilgjald) is 0.8% on property transfers. Iceland is not an EU member but belongs to the EEA, affecting VAT and trade rules.
๐ซ๐ฎ Finland โ Municipal Income Tax
Finland's 309 municipalities set their own income tax rates (municipal tax) ranging from ~16.5% to ~22.5%, averaging ~20%. This is added to the national progressive income tax. The church tax of 1%โ2.2% applies to members. No regional income tax. The 'solidarity tax' on high earners (2%) applies nationally. Municipalities also levy real estate tax on property owners. The welfare state is heavily funded by these high combined tax rates.
Iceland vs Finland: Key Tax Differences (2026)
๐ฐ Income Tax: ๐ซ๐ฎ Finland has a higher top income tax rate (~36.94% vs ~44โ51.4%). ๐ฎ๐ธ Iceland is more favourable for high earners.
๐ VAT/Sales Tax: Finland has a higher consumption tax (11โ24% vs 10โ25.5%).
๐ข Corporate Tax: Corporate rates are similar in both countries (20% vs 20%).
๐ Capital Gains: ๐ฎ๐ธ Iceland taxes investment gains at a lower rate (22% vs 34%), benefiting investors.