Lithuania vs Iceland
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.
๐ฑ๐น Lithuania โ Municipal Income Tax Supplement
Lithuania's 60 municipalities levy a local supplement on income tax โ 68% of PIT revenue goes to municipalities, creating strong local fiscal capacity. Property tax (nekilnojamojo turto mokestis) is set at 0.5%โ3% by municipalities on commercial property and at 0.5%โ2% on residential property above โฌ150K value. Vehicle registration tax is national. Lithuania switched to a progressive income tax in 2019, having previously had a flat 15% rate.
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.
Lithuania vs Iceland: Key Tax Differences (2026)
๐ฐ Income Tax: ๐ฎ๐ธ Iceland has a higher top income tax rate (20โ32% vs ~36.94%). ๐ฑ๐น Lithuania is more favourable for high earners.
๐ VAT/Sales Tax: Iceland has a higher consumption tax (9โ21% vs 11โ24%).
๐ข Corporate Tax: ๐ฑ๐น Lithuania offers a lower corporate rate (15% vs 20%), which can influence business location decisions.
๐ Capital Gains: ๐ฑ๐น Lithuania taxes investment gains at a lower rate (20% vs 22%), benefiting investors.