Iceland VAT rate to 22.5% 2019

Thu 6th Apr 2017

The Icelandic government is planning to reduce its standard VAT rate from 24% to 22.5% from 1 January 2019.

The announcement came as part of the 2018 to 2022 fiscal budget plan.

Iceland had raised its VAT rate to 25.5% during the global financial crisis in 2010, but cut it to 24% in 2015.

Tourism services will be recategorised from the reduced VAT rate of % to the standard rate temporarily to help fund a cut in employer taxes.


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