Iceland: cost of living

How expensive is Iceland compared with Europe?

Food and non-alcoholic drink prices in Iceland were 56% above the EU average in 2025, according to Statistics Iceland's European price comparison, published 19 June 2026 with Eurostat data. GDP per head, adjusted for prices, was 28% above the EU average, and actual consumption per head 15% above.

A price level above the EU average means the same basket of goods costs more in Iceland. The figures use purchasing power standards, which adjust for price differences between countries, so they compare what money actually buys.

Official sources: Statistics Iceland: comparison of consumption, GDP and price levels in Europe 2025

Why did petrol prices go up in Iceland?

Petrol prices in Iceland rose 16.1% and diesel 18.1% in September 2026, according to Statistics Iceland's consumer price index release. On 1 September a temporary cut in VAT on fuel ended, raising VAT on petrol and diesel from 11% to 24%.

Without the VAT change, diesel would have risen 5.7% and petrol 3.9% in the month. Statistics Iceland estimates the VAT change added about 0.32% to the overall price index. International flight prices fell 11.7% in the same month.

Official sources: Statistics Iceland: consumer price index, September 2026

How fast are prices rising in Iceland?

The latest figure from the IMF, for 2025, is 4.1%. Its high point since 2005 was 2008, at 12.7%; its low point was 2015, at 1.6%. It is 14th highest of 48 in Europe & Central Asia, where the median is 3.7%. Of 165 countries with 2025 data, 46th highest.

How much do households in Iceland spend per person?

$31,408: that is household consumption per person in Iceland for 2025, according to the World Bank. It is the top of the series, which starts in 2005. Europe & Central Asia median: $11,266; Iceland is 4th highest of 44. Of 124 countries with 2025 data, 5th highest.

What is the extreme poverty rate in Iceland?

According to the World Bank, the share of people living on less than $3.00 a day in Iceland was 0.1% in 2019. Since 2005 it has ranged from 0.0% (2005) to 0.3% (2018). It is 29th highest of 42 in Europe & Central Asia, where the median is 0.3%. World rank, highest first: 60th of 77.

How many people in Iceland are poor?

8.8%: that is the share of people below the national poverty line in Iceland for 2017, according to the World Bank. Its high point since 2005 was 2008, at 10.2%; its low point was 2011, at 7.9%. Europe & Central Asia median: 18.5%; Iceland is 30th highest of 31. World rank, highest first: 48th of 53.

What is Iceland's Gini coefficient?

The latest figure from the World Bank, for 2019, is 26.8. Its high point since 2005 was 2008, at 31.8; its low point was 2013, at 25.4. Europe & Central Asia median: 30.6; Iceland is 36th highest of 42. World rank, highest first: 71st of 77.

How many people in Iceland go hungry?

In 2024, moderate or severe food insecurity in Iceland was 7.9%, according to the FAO. No year since 2015 has been higher. It is 21st highest of 45 in Europe & Central Asia, where the median is 7.6%. Worldwide: 105th of 135.