Iceland Enacts 39 Percent Exit Tax
June 9, 2015 Taxation in Iceland
REYKJAVIK – Iceland is giving failed banks the option of paying a massive stability tax or meeting a set of payment requirements before being allowed to transfer funds overseas.
On June 8th the government of Iceland revealed a set of new proposed measures aimed at loosing capital controls in the country, while at the same time implementing new tax measures to make sure that there is not an exodus of capital.
Currently an estimated ISK 1 200 worth of assets are under strict capitals controls, following a mass flood of inward investment after the collapse of the country’s three major banks in 2008.
Under the new regulations, the estates of the failed banks are required to fulfil a set of conditions, which if not met will require the institution to pay a once-off tax of 39 percent on their Icelandic assets.
The banks will only be allowed to transfer funds only after they either pay the tax or meet the required conditions, with both options expected to raise the same amount of tax revenues for the government.
Photo By: Tijl Vercaemer