If you import, export, or work with customs declarations in Iceland, major updates are coming on January 1, 2025. These changes impact import duties, excise taxes, and customs reporting requirements, affecting businesses, software providers, and individual consumers alike. Let’s break it down in plain language.
Key Takeaways: What’s Changing?
- Higher Taxes on Alcohol and Tobacco
- Alcohol duties are increasing across the board, with different rates for beer, wine, and stronger spirits.
- Tobacco products, including cigarettes and loose tobacco, will also see a price hike.
- New nicotine tax: If you use nicotine pouches or e-cigarettes, expect new taxation based on nicotine strength.
- Environmental Fees on Packaging
- Companies that import goods with plastic, wood, paper, or other packaging will see adjusted recycling fees.
- Some plastic packaging fees are lowering, while paper and wood packaging fees are going up.
- Fuel and Carbon Taxes Are Rising
- Diesel, gasoline, and other fuels will be taxed more heavily under updated carbon and fuel duties.
- Expect price increases at the pump due to these adjustments.
- Changes to Customs Declarations & Reporting
- From January 1, 2025, all customs declarations must include additional details, including sender/receiver addresses and more precise product classifications.
- Software developers providing customs reporting tools must update their systems accordingly.
- Customs System Downtime Over New Year’s
- Customs processing systems will be offline from 3:30 PM on December 31, 2024, until noon on January 2, 2025—plan your shipments accordingly!
How Does This Affect You?
- Importers & Exporters: Higher taxes mean increased costs, so budgeting for these changes is essential.
- Businesses & Retailers: If you sell alcohol, tobacco, or fuel, prices will go up due to higher excise duties.
- Consumers: Expect price increases on affected goods, including alcohol, tobacco, and fuel.
- Software Providers: If you develop customs software, updates will be required to align with the new reporting standards.
What Should You Do Now?
- Check Your Imports: If you bring in goods that will be affected (alcohol, tobacco, packaging-heavy items), review the new rates.
- Plan Ahead for Delays: With customs systems offline during New Year’s, ensure any urgent shipments are processed in advance.
- Update Your Software & Records: Businesses relying on customs declaration software should ensure compliance with new requirements.
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