Iceland vs Bhutan
Tax Rate Comparison
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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.
๐ง๐น Bhutan โ Dzongkhag & Thromde Taxes
Bhutan's 20 dzongkhags (districts) and thromdes (municipalities) levy local land tax, cattle tax, and local fees. Bhutan is a constitutional monarchy pursuing Gross National Happiness over GDP. Corporate and business income taxes are primary revenue sources; personal income tax is minimal for most citizens given the country's structure. Bhutan has major hydropower export revenues from India and has become notable for state-enterprise cryptocurrency mining. The country is transitioning toward more market-oriented development with LDC graduation aspirations.
Iceland vs Bhutan: Key Tax Differences (2026)
๐ฐ Income Tax: ๐ฎ๐ธ Iceland has a higher top income tax rate (~36.94% vs 0โ25%). ๐ง๐น Bhutan is more favourable for high earners.
๐ VAT/Sales Tax: Iceland has a higher consumption tax (11โ24% vs 0%).
๐ข Corporate Tax: ๐ฎ๐ธ Iceland offers a lower corporate rate (20% vs 30%), which can influence business location decisions.
๐ Capital Gains: ๐ง๐น Bhutan taxes investment gains at a lower rate (0% vs 22%), benefiting investors.