Iceland VAT rate
The standard rate of virðisaukaskattur (value added tax) on supplies of goods and services in Iceland, levied under Lög nr. 50/1988 um virðisaukaskatt (VAT Act 1988) and administered by Skatturinn (Iceland Revenue and Customs / Skatturinn, formerly Ríkisskattstjóri). Iceland is NOT in the EU, so its VAT is a national tax outside the EU VAT Directive — but it is a conventional destination-based VAT and non-resident suppliers of electronic services to Icelandic consumers must register.
| Current value | 24 percent |
|---|---|
| In force from | 2015-01-01 |
| Official source | Skatturinn — Value Added Tax (companies): standard rate of VAT in Iceland is 24%; reduced rate 11%. Confirmed against Skatturinn's 'Key rates and amounts 2026' page, which lists VAT standard rate 24% and reduced rate 11% for 2026. |
| Last verified | 2026-07-24 |
| Verification | primary — No verification limitation recorded — read from the official source cited. |
| Provenance | source fingerprint |
What this value means
TWO RATES, ONE SERVED. Standard rate 24% — unchanged since 1 January 2015, when it was cut from 25.5% in the same reform that RAISED the reduced rate from 7% to 11%. The 11% reduced rate (notes only, not the served value) covers: hotel, guesthouse and short-term accommodation (rental under one month), campsites, food and catering including alcoholic beverages, passenger transport that is not exempt, travel-agent and tour-operator services and licensed guide services, spa/sauna/health facilities, road tunnel tolls, radio and TV subscriptions, books, newspapers and magazines (print and electronic), recorded music, geothermal hot water, electricity and heating oil, condoms and reusable nappies. A 0% rate (zero-rating with input deduction) applies to exports and certain international services; some supplies (health, education, financial services, letting of real property) are exempt without deduction. TRAP: a legislated cut of the standard rate to 22.5% from 2019 was widely reported in 2015-2016 tax-plan coverage and is still repeated by aggregators — it was never brought into force. The rate is 24% and has been for eleven years. Registration threshold: turnover of taxable goods and services of ISK 2,000,000 or less in any twelve-month period from the start of business is exempt from registration (raised from ISK 1,000,000 on 1 January 2017).
Get it programmatically
curl https://euroref.dev/v1/is/vat
# $0.001 per call — x402 on Base (USDC). No key, no signup.
# History: curl https://euroref.dev/v1/is/vat/history?from=2020-01-01
# Provenance: curl https://euroref.dev/provenance/is/vatOther Iceland series: policy interest rate · minimum wage · public holidays · inflation rate (CPI) · corporate tax rate · income tax rates · official exchange rates