IS · EuropeLU · Europe
Iceland vs Luxembourg: tax rates compared
Between the two, Iceland's income tax rate (46.3%) tops Luxembourg's (45.8%) by 0.5pp. The 200-country average is 28%: both sit above it.
Verified data covers six of the six tracked tax types for both countries; every rate below is cited to its source and dated.
At a glance
| Tax | IS | LU | Difference |
|---|---|---|---|
| Income Tax | 46.3% | 45.8% | IS +0.5 pp |
| Corporate Tax | 20% | 23.9% | LU +3.9 pp |
| VAT | 24% | 17% | IS +7 pp |
| Capital Gains Tax | 22% | 0% | IS +22 pplargest gap |
| Crypto Tax | 22% | 0% | IS +22 pp |
| Wealth Tax | 0% | 0% | match |
Income Tax
| Country | Rate | Source |
|---|---|---|
| Iceland | 46.3% | Source: OECD Tax Database — Top statutory personal income tax rates · as of 2025-01-01 |
| Luxembourg | 45.8% | Source: OECD Tax Database — Top statutory personal income tax rates · as of 2025-01-01 |
| Difference | +0.5 pp | Iceland higher |
Corporate Tax
| Country | Rate | Source |
|---|---|---|
| Iceland | 20% | Source: Tax Foundation — Worldwide Corporate Tax Rates · as of 2025-01-01 |
| Luxembourg | 23.9% | Source: Tax Foundation — Worldwide Corporate Tax Rates · as of 2025-01-01 |
| Difference | −3.9 pp | Luxembourg higher |
Between the two, Luxembourg's corporate tax rate (23.9%) tops Iceland's (20%) by 3.9pp. The 201-country average is 22.6%: Iceland sits below it, Luxembourg sits above it.
VAT
| Country | Rate | Source |
|---|---|---|
| Iceland | 24% | Source: PWC Worldwide Tax Summaries — Iceland (Corporate, Other taxes) · as of 2026-06-22 |
| Luxembourg | 17% | Source: PWC Worldwide Tax Summaries — Luxembourg (Corporate, Other taxes) · as of 2026-01-13 |
| Difference | +7 pp | Iceland higher |
Between the two, Iceland's VAT rate (24%) tops Luxembourg's (17%) by 7pp. The 181-country average is 15%: both sit above it.
Capital Gains Tax
| Country | Rate | Source |
|---|---|---|
| Iceland | 22% | Source: Skatturinn (Iceland Revenue and Customs) — Key rates and amounts 2026 · as of 2026-01-01 |
| Luxembourg | 0% | Source: PWC Worldwide Tax Summaries — Luxembourg (Individual, Income determination) · as of 2026-01-13 |
| Difference | +22 pp | Iceland higher |
Between the two, Iceland's capital gains tax rate (22%) tops Luxembourg's (0%) by 22pp. The 175-country average is 10.3%: Iceland sits above it, Luxembourg sits below it.
Crypto Tax
| Country | Rate | Source |
|---|---|---|
| Iceland | 22% | Source: Skatturinn (Icelandic Revenue and Customs) — Rafmynt (Cryptocurrency) · as of 2026-07-19 |
| Luxembourg | 0% | Source: Luxembourg Direct Tax Administration (Administration des contributions directes) — Circular L.I.R. n° 14/5 – 99/3 – 99bis/3 (26 July 2018), "Monnaies virtuelles" · as of 2018-07-26 |
| Difference | +22 pp | Iceland higher |
Between the two, Iceland's crypto tax rate (22%) tops Luxembourg's (0%) by 22pp. The 88-country average is 13%: Iceland sits above it, Luxembourg sits below it. Iceland's figure is dated 2026-07-19 and Luxembourg's 2018-07-26, so the two rates come from different data vintages.
Wealth Tax
| Country | Rate | Source |
|---|---|---|
| Iceland | 0% | Source: PWC Worldwide Tax Summaries — Iceland (Individual, Other taxes) · as of 2026-06-22 |
| Luxembourg | 0% | Source: PWC Worldwide Tax Summaries — Luxembourg (Individual, Other taxes) · as of 2026-01-13 |
| Difference | 0 pp | displayed rates match |
There's no gap here — Iceland and Luxembourg both post a wealth tax rate of 0%. The 193-country average is 0.1%: both sit below it.