This welcome stability is thought to be due to several factors, not least of which is increased confidence in the Icelandic economy.
An Icelandic company has today failed in its appeal against the tax authority’s decision not to allow it to claim ISK 250 million (EUR 2.11/USD 2.26 million) in sports betting losses as tax deductible.
At a press conference yesterday, Icelandic Prime Minister Bjarni Benediktsson and Minister of Finance Benedikt Jóhannesson announced that all capital controls for individuals, companies and pension funds will be lifted tomorrow.
Yesterday, Icelandic MPs unanimously voted to pass a parliamentary bill regarding the lifting of capital controls.
Moody’s Investor Service raised the credit rating for the Icelandic state treasury by two points, from Baa2 to A3 yesterday, with stable outlook. Iceland’s credit rating has not been higher since in late 2008.
In all likelihood, the foreign currency reserves of the Central Bank of Iceland will be large enough this fall for the lifting of capital controls for the Icelandic public and Icelandic companies to begin.
As part of the government’s plan to lift capital controls in Iceland, the country’s Central Bank will hold a foreign currency auction on June 16.
A bill submitted before parliament Friday afternoon by Finance Minister Bjarni Benediktsson regarding so-called offshore króna accounts was passed late last night with 47 members of parliament voting for it.
Central Bank of Iceland Director Már Guðmundsson states now is the best time to lift capital controls.
Prime Minister of Iceland, Sigmundur Davíð Gunnlaugsson, has been keeping quiet about his wife’s business dealings, amid claims the issue is causing a major rift within the coalition government.
Lee Buchheit, a lawyer given the label ‘Crusader for Financially Stricken Countries’ by the Financial Times, is well-known in Iceland.
The claimants of the collapsed Icelandic banks have agreed to the conditions introduced by the government of Iceland in order to guarantee economic stability when the capital controls—which have been in place since the banking collapse in 2008—will be lifted.