Iceland vs Bahamas
Tax Rate Comparison
Enter your income below for a personal tax estimate, then scroll down for full rate breakdowns.
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.
๐ง๐ธ Bahamas โ Local Government Rates & Fees
The Bahamas' islands have local government bodies collecting fees for services, building permits, and business licences. The Bahamas famously has no income tax, no capital gains tax, no corporate income tax, and no withholding tax โ making it one of the world's purest zero-tax jurisdictions. Revenue comes through VAT (introduced 2015), real property tax, customs duties, and stamp duty. As a major offshore financial centre and tourism destination, the Bahamas has faced OECD/FATF pressure on transparency and has made significant reforms.
Iceland vs Bahamas: Key Tax Differences (2026)
๐ฐ Income Tax: ๐ฎ๐ธ Iceland has a higher top income tax rate (~36.94% vs 0%). ๐ง๐ธ Bahamas is more favourable for high earners.
๐ VAT/Sales Tax: Iceland has a higher consumption tax (11โ24% vs 10%).
๐ข Corporate Tax: ๐ง๐ธ Bahamas offers a lower corporate rate (0% vs 20%), which can influence business location decisions.
๐ Capital Gains: ๐ง๐ธ Bahamas taxes investment gains at a lower rate (0% vs 22%), benefiting investors.