Union Proposes Tax Relief For Low Income Earners - The Reykjavik Grapevine

Union Proposes Tax Relief For Low Income Earners

Published November 4, 2013

The Confederation of Icelandic Labour Unions (ASÍ) believes the government’s proposed changes to income tax are unfair to those making the least amount of money, and have proposed changes of their own.
As reported, the Progressive/Independence Party ruling coalition has proposed lowering taxes for those in the so-called “middle bracket”, i.e., those making 250,000 ISK to 800,000 ISK per month, by 0.8%. However, only those making making upwards of 780,000 per month stand to see any significant effect from this “tax break”.
RÚV now reports that ASÍ does not believe these proposed changes to the tax system are fair to those in the bottom tax bracket. The union has proposals of their own.
Rather than a tax break across the middle bracket of less than 1%, the union proposes that the bottom level of the middle bracket be raised from 250,000 ISK per month to 350,000 ISK. This would provide greater tax relief for more people who earn a low wage in Iceland, the union contends.
How the union’s idea will play out remains to be seen – this government already has plans in the works to combine all incomes into a single tax bracket by the end of their first term in office.

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