Iceland: public finances

What is Iceland's government debt?

Iceland's general government gross debt was 4,360.7 billion krónur, or 88.3% of GDP, at the end of 2025, according to Statistics Iceland's general government finances 2025 release of 15 September 2026. Central government debt was 75.0% of GDP and local government debt 13.3%.

Gross debt here follows European accounting rules and includes pension liabilities, which rose 17.4% in 2025 and drove most of the increase. Net of financial assets, the government's net financial worth was minus 38.2% of GDP, a better guide to what it owes overall.

Official sources: Statistics Iceland: general government finances 2025

Does Iceland have a budget deficit?

Iceland's general government had a deficit of 130.8 billion krónur in 2025, equal to 2.6% of GDP, down from 4.1% in 2024, according to Statistics Iceland's general government finances 2025. Revenue was 43.0% of GDP and spending 45.7%.

The 2024 figure was raised by spending on natural disasters. In the second quarter of 2026 the deficit was 48.3 billion krónur, or 3.8% of quarterly GDP, according to the quarterly release, as spending grew faster than revenue. General government includes central and local government.

Official sources: Statistics Iceland: general government finances 2025 · Statistics Iceland: general government finances, 2nd quarter 2026

What is Iceland's debt to GDP ratio?

According to the IMF, general government gross debt in Iceland was 56.7% of GDP in 2025. No year since 2005 has been lower. Across Europe & Central Asia the middle value was 46.9% of GDP, and Iceland placed 19th highest of 51. Worldwide: 83rd of 185.

What is Iceland's budget deficit?

The latest figure from the IMF, for 2025, is -2.6% of GDP (a deficit). The peak was 12.7% of GDP in 2016 and the low -12.0% of GDP in 2008. It is 29th highest of 51 in Europe & Central Asia, where the median is -2.4% of GDP. Worldwide: 92nd of 188.

How much does Iceland's government take in?

In 2025, general government revenue in Iceland was 43.0% of GDP, according to the IMF. Since 2005 it has ranged from 40.7% of GDP (2021) to 58.5% of GDP (2016). Across Europe & Central Asia the middle value was 41.3% of GDP, and Iceland placed 21st highest of 50. Worldwide: 33rd of 187.

What is Iceland's government spending?

45.7% of GDP: that is general government spending in Iceland for 2025, according to the IMF. The peak was 62.8% of GDP in 2008 and the low 43.0% of GDP in 2019. It is 18th highest of 50 in Europe & Central Asia, where the median is 43.3% of GDP. Of 186 countries with 2025 data, 31st highest.

What is Iceland's tax to GDP ratio?

The IMF puts central government tax revenue in Iceland at 23.2% of GDP in 2023. The peak was 37.1% of GDP in 2016 and the low 19.8% of GDP in 2009. Europe & Central Asia median: 19.6% of GDP; Iceland is 14th highest of 47. Of 110 countries with 2023 data, 20th highest.

How much does Iceland spend on its military?

In 2025, military spending in Iceland was 0.0% of GDP, according to SIPRI. The figure has been the same every year since 2005. Across Europe & Central Asia the middle value was 2.0% of GDP, and Iceland placed 46th highest of 46. Worldwide: 147th of 149.