From Iceland — Rich Not Fleeing Iceland To Pay Lower Taxes

Rich Not Fleeing Iceland To Pay Lower Taxes

Published July 30, 2012

The director of the Tax Office says that Iceland’s wealthy are not leaving the country to countries where they would pay lower taxes.
The auditing company Deloitte and Touch told reporters recently that the country’s wealthiest citizens might be leaving the country in an effort to pay lower taxes. This worry, RÚV reports, is not grounded in the actual facts of the matter.
Director of the tax office Skúli Eggert Þórðarson says that according to their data, about 31,000 people have had to pay capital gains tax – down by about 7,700 from last year. However, of those, only 173 have moved to countries where they might pay lower taxes, e.g. to Luxembourg or Switzerland. The rest have moved to the US, Germany or other Nordic countries, where the percentage of capital gains tax they would have to pay is actually comparable to Iceland.
Of those who pay more than 100,000 ISK in taxes, only 62 have left the country for destinations where they would pay less. Of those, only about a third would have to pay more than 200,000 ISK.
The explanation behind why there are fewer paying capital gains, Skúli says, is based primarily on lower interest rates this year than in the year previous. Of the 42 who did not pay capital gains tax this year, 35 had passed away, and only seven moved abroad.

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