Italy vs Iceland
Tax Rate Comparison
Enter your income below for a personal tax estimate, then scroll down for full rate breakdowns.
💰 Personal Income Tax Calculator
Enter your income to see your estimated annual tax liability in each country — side by side.
Individual Income Tax (Top Marginal Rate)
VAT / GST / Sales Tax
Corporate Tax Rate
Capital Gains Tax
Social Security & Payroll
🇮🇹 Italy — Regional & Municipal Income Taxes
Italy's 20 regions levy addizionale regionale at 0.7%–3.33%. Municipalities add addizionale comunale up to 0.9%. Sicily, Sardinia, and Trentino-Alto Adige have special autonomous status. IRAP (regional business tax) at ~3.9% applies to businesses. Local property tax (IMU) is set by municipalities on investment properties. Cumulative marginal rates can exceed 50%.
🇮🇸 Iceland — 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.
Italy vs Iceland: Key Tax Differences (2026)
💰 Income Tax: 🇮🇹 Italy has a higher top income tax rate (23–43% vs ~36.94%). 🇮🇸 Iceland is more favourable for high earners.
🛒 VAT/Sales Tax: Iceland has a higher consumption tax (4–22% vs 11–24%).
🏢 Corporate Tax: 🇮🇸 Iceland offers a lower corporate rate (20% vs 24%), which can influence business location decisions.
📈 Capital Gains: 🇮🇸 Iceland taxes investment gains at a lower rate (22% vs 26%), benefiting investors.