Fishing Industry Profits Spark Wealth Distribution Debate

fishing in Iceland

Iceland’s largest seafood companies made huge profits last year, if the first published financial statements are any indication, Fréttablaðið reports. Opposition MPs are arguing that the industry should be taxed more so its earnings are more evenly distributed throughout Icelandic society. According to Minister of Fisheries Svandís Svavarsdóttir, the nation sees the industry as unjust, largely because consolidation of fishing quota has funnelled large profits into the hands of very few individuals.

Billions in profits

At the end of 2020, the seafood industry’s equity was evaluated at ISK 325 billion [$2.6 billion; €2.4 billion]. In the same year, the industry paid just under ISK 4.8 billion [$37.7 million; €35.2 million] in quota fees, while the state treasury faced record financial challenges due to the coronavirus pandemic.

The fishing industry has continued to grow despite the pandemic recession. Between 2020 and 2021, the total value of catch in Iceland increased around 9%, from ISK 148.3 billion [$1.2 billion; €1.1 billion] to ISK 162.2 billion [$1.3 billion; €1.2 billion], according to figures from Statistics Iceland. Prospects continue to be good, especially since the price of fish has risen dramatically in the wake of the Russian invasion of Ukraine.

Four companies hold 60% of quota

Just four companies hold around 60% of Iceland’s fishing quota: Samherji, Brim, KS, and Ísfélagið. Brim reported profits of ISK 11.3 billion [$88.8 million; €82.9 million] last year, and Síldarvinnslan’s profits are similar. In the first three months of this year, Síldarvinnslan has made profits of nearly ISK 4 billion [$31.4 million; €29.3 million]. Samherji, Kaupfélag Skagfirðinga (KS), and other fishing industry giants have not yet submitted financial statements from last year, but similarly high profits are expected.

In a column published in Morgunblaðið yesterday, Minister of Fisheries Svandís Svavarsdóttir stated that the nation viewed the consolidation of fishing quota in so few hands as deeply unjust, and that it felt that this collective resource was not distributed fairly.

Fishing money in other sectors

Opposition MP and Social-Democratic Alliance Chairman Logi Einarsson echoed these words. “We have watched a huge accumulation of wealth in very few hands, which has also led to a small number of individuals not only holding the majority of fishing quota, but due to this same wealth, accumulated assets in many parts of society, in unrelated sectors.” Logi named these sectors as the media, real estate, transport, grocery stores, energy, and even insurance and banking.

“This creates a very unhealthy situation,” Logi continued. “And now that the entire public expects worsening livelihoods and various healthcare and welfare services are underfunded, quota holders should certainly pay more toward public expenditure, they are well capable of it, to say the least.”

Unions Express ‘Anger and Disappointment’ Over Government’s Newly Proposed Tax Plan

Last night, Minister of Finance and Economic Affairs Bjarni Benediktsson presented the government’s proposals regarding tax and wage issues that have been under negation with four of Iceland’s labour unions and the Confederation of Icelandic Enterprise (SA). RÚV reports that while Bjarni laid out the proposals for the public during a live new conference on Tuesday evening, earlier that day, he had presented these to the unions in a private meeting. The union chairs were, however, unimpressed by the government’s proposals: “It was hoped that the government’s involvement could rekindle the discussion,” read a statement co-signed by the chairs of each union. “But it’s clear from the government’s proposals that this hope will come to nothing.”

The government’s contribution to the debate involved a significant change to the Icelandic tax system wherein the lowest tax level would be newly set at a monthly wage of ISK 325,000 [$2,718; €2,395] a month. The taxation on this level would be 32.94%.  The tax-free limit would be set at ISK 159.174 a month, taking into account a 4% pension contribution.

Bjarni’s presentation explained that the limit for both the first and second tax levels would be ISK 325,000 in order to maximize, he said, the benefits for low-income groups, as well as people with disabilities and the elderly. Per the second level, however, those who earn less than ISK 927,087 [$7,746; €6,830] a month would be taxed at 36.94% while those who make more than that would be taxed at 46.24%.

Bjarni said that on average, taxes would go down more for women than men, and also among individuals aged 18-24. The proposal anticipates a ISK 3.6 billion [$30.1 million; €26.5 million]. In addition, the proposal asserts that the following groups will also benefit from the tax level adjustment: people aged 25 – 34, people with disabilities, the elderly, people who do not own a home, people who receive special housing benefits.

The total impact of the changes to the taxation system would amount to ISK 14.7 billion [$120.4 million; €106.1 million].

Per the unions’ co-signed statement which was issued in advance of the press conference, the chairs of the four unions—VR, Efling, VLFA and VLFGrv—responded to the government’s proposals “ …with anger and disappointment.”

“Negotiations have been in a critical position after the SA business association made an offer last week which would have led to reduced purchasing power for large groups of workers,” read the statement. “The SA in turn rejected a fair counteroffer by the four unions.” The unions plan to hold internal meetings about the issue over the next few days and will then meet with SA again in the company of a state mediator.

“The four unions stand united and steadfast in their demand that workers should be able to live off their wages,” closed the statement, asserting “that the government should make long overdue systemic changes in the direction of justice.”

Bjarni’s Power Point presentation can be accessed in full (in Icelandic) here.

Read an English translation of the union chairs’ statement, here.

Socialist City Councillor Takes Wage Cut to Support Fund for Organisers

City Councillor Sanna Magdalena Mörtudóttir

Socialist City Councillor Sanna Magdalena Mörtudóttir has decided to take a monthly pay cut of ISK 158,000 ($1,280/€1,133) and redirect that money to the party’s newly established Maístjarna fund, Kjarninn reports. The fund is intended to empower “those who are worst off” to organise and operate lobbying groups that will work for their interests.

The Socialist Party is using funds received from the City of Reykjavík – around ISK 900,000 ($7,295/ €6,454) – to establish the fund and will supplement these with individual contributions as well as the additional income from Sanna’s voluntary pay cut. According to the announcement on the Socialists’ website, the fund “will work to bolster and strengthen the voices of those who are worst off and assist them in presenting their demands and urging that the country of the future be shaped in the interests of the people.”

Even with the pay cut, Sanna’s monthly salary before taxes is, she notes, 2.5 times the minimum wage. According to data published by Statistics Iceland in August, Icelanders’ average total monthly income—including non-wage, physical or financial assets – was ISK 534,000 ($4,328/ €3,830) before taxes, which are 36.94% for individuals whose monthly income is less than ISK 893.713 ($7,243/€6,410).

“I think we should set a limit on the highest salaries in society – on how much higher they can be than the minimum wage” Sanna remarked. “I think three times the minimum wage is the absolute outer limit, for example, for the mayor and so I’m setting my salary a step below that.”

The first initiative to be funded by the Maístjarna was the demonstration at Austurvöllur square on December 1, in protest of the MPs involved in the Klaustur Scandal. Expenses for the protest came to ISK 140,000 ($1,134/€1,004). An independent group of protesters raised ISK 106,000 ($859/€760) for the event, and the remaining ISK 34,000 ($275/€243) will be subsidised by the Maístjarna.

Sanna is encouraging Socialists who are able to donate to the fund to follow her lead and do so. “The most important step in the direction of a just society is that those who are suffering most under the injustice of capitalism to be able to organise, create solidarity among themselves, and develop tactics to fight for their interests.”

Website Showing Icelanders’ Income Won’t Be Shut Down


An injunction against, a website that makes Icelanders’ income public, has been denied, RÚVreports. The injunction was filed by Ingvar Smári Birgisson, lawyer and chairman of Young Independents (the youth organisation of the Independence Party of Iceland), who called the website a violation of the privacy act and the handling of personal information. went online last Friday. It provides information on the wages of all adult individuals residing in Iceland for an initial monthly subscription fee of ISK 2,790 ($23/€20), lowered to ISK 790 ($7/€6) from the second month onward. The website was created “with the aim of promoting informed and honest discussion about the participation of taxpayers in the public sector,” states.

A statement from the District Court of Reykjavík reads that as the issue is already being considered by the appropriate authorities and a decision is forthcoming, it does not consider it appropriate to apply an injunction on the website. Ingvar Smári expressed disappointment in the decision, stating “in view of the fact that the magistrate accepts the violation of statutory rights to privacy, I of course consider it necessary to defend my rights in court.”

The Icelandic Data Protection Authority has received at least nine complaints from individuals about Labour union representatives, however, have expressed support for the initiative. “This data brings out the inequality and injustice that thrives in Icelandic society and it is therefore extremely important that this website isn’t shut down,” stated Vilhjálmur Birgisson in a Facebook post.

Idea that Iceland Has No Class Divisions a Myth, Says Sociologist

Although it’s often said that Iceland is a country without significant class divisions, a sociologist who has been studying this phenomenon for years says this is far from the truth, Vísir reports.

“What happened here from the mid-1990s up until the financial crisis [of 2008] is that economic inequality increased rapidly,” says Guðmundur Ævar Oddsson, who holds a doctorate in sociology and who for years has studied the phenomenon within an Icelandic context. “Particularly when it comes to income distribution, but also in terms of asset distribution.” Guðmundur says that although income distribution became more equal after the crash, the income gap is starting to widen once again, and so has asset distribution.

According to data from the City of Reykjavík, 2.9% of children up to the age of 17 receive some form of financial assistance from the municipal government. Guðmundur says that childhood poverty is, however, something that could easily be remedied if the decision were simply made to do so.

“All inequality is, in reality, a human invention, such that it’s possible for us to intervene. There’s no natural law that says that childhood poverty should be 5% rather than 0% or 10%,” he explained.

“Of course there are numerous studies—hundreds, if not thousands—that show that as the gap between groups or whatever you want to call the classes increases, it has a negative impact on crime rates, people’s heath, trust between groups, [and] political participation,” says Guðmundur.

Guðmundur’s message to the Efling trade union that he recently addressed and to the government at large simple: “It is to everyone’s benefit—even those who are rich and own the most—to try and keep the gap within reasonable limits.”