With the prospect of two new parties in parliament, and one of the parties in the current tri-party government not getting enough votes to get into parliament, the scene is set for possibly months of difficult coalition talks.
In early counting, the Independence Party, the main party in the current government coalition, lost 3 percentage points from last year’s election to land at 26 percent of the votes.
The Left-Green Movement, headed by the charismatic Katrin Jakobsdottir, 41, came in second with 17 percent, up 1 percentage point from last year’s election, and its probable ally the Social Democrats in third with 13 percent, almost doubling its size.
Prime Minister Bjarni Benediktsson, 47, of the Independence Party called the snap election after a scandal involving an attempt by his father to vouch for the character of a convicted pedophile cost him one of his coalition partners.
The Nordic island of 340,000 people, one of the countries hit hardest by the 2008 financial crisis, has staged a remarkable economic rebound spurred by a tourism boom.
But political scandals, a growing sense of inequality and worries about immigration are jeopardizing stability in one of the most homogeneous nations on earth.
The previous government was felled last year by the Panama Papers scandal over offshore tax havens.
The Independence Party has dominated power for decades. It wants to reduce the national debt and cut taxes on individuals and businesses. The party won 21 seats in the 63-seat parliament in elections a year ago.
The Left-Greens want to fight inequality and fund an increase in public health care, education and infrastructure spending by hiking taxes for the wealthy and introduce a property tax.
The party, which currently holds 10 seats in the parliament, came in second in last year’s election but failed to form a government coalition.
Pirate Party, which last year rode on a wave of anger against the establishment to become the third biggest party in parliament, stood to get 8 percent of votes in Saturday’s election down from 14 percent last year.
The Centre Party, which was formed this September by former Prime Minister Sigmundur David Gunnlaugsson after he and his supporters left another party, got 11 percent of the votes in the early counting.
Gunnlaugsson resigned from his post as prime minister in 2016 following protests after revelations that linked him to the Panama Papers leak.
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