This report is based on a systematic review of open source information about the finances of Islamic State in its core territory in Syria and Iraq.

Key findings

  • Estimates vary widely. It remains impossible to say exactly how much money Islamic State has at its disposal.
  • The group’s most significant sources of revenue are closely tied to its territory. They are: (1) taxes and fees; (2) oil; and (3) looting, confiscations, and fines. We have found no hard evidence that foreign donations continue to be significant. Similarly, revenues from the sale of antiquities and kidnap for ransom, while difficult to quantify, are unlikely to have been major sources of income.
  • In the years since 2014, Islamic State’s annual revenue has more than halved: from up to $1.9b in 2014 to a maximum of $870m in 2016. There are no signs yet that the group has created significant new funding streams that would make up for recent losses. With current trends continuing, the Islamic State’s “business model” will soon fail.


  • Evaluating Islamic State finances through traditional approaches towards “countering terrorist finance” leads to serious misconceptions. Islamic State is fundamentally different because of the large territory it controls and the unique opportunities this offers for generating income.
  • Conversely, its reliance on population and territory helps to explain the group’s current financial troubles. According to figures provided by the Global Coalition, by November 2016 Islamic State had lost 62 per cent of its mid-2014 “peak” territory in Iraq, and 30 per cent in Syria. From a revenue perspective, this means fewer people and businesses to tax and less control over natural resources such as oil fields.


  • There are good reasons to believe that Islamic State revenues will further decline. In particular, capturing Mosul, the Caliphate’s “commercial capital”, will have a significant detrimental effect on Islamic State finances
  • Nevertheless, Islamic State, and its Al-Qaeda in Iraq (AQI) predecessor, have repeatedly demonstrated that financial and military setbacks can be overcome.
  • Moreover, the decline in revenues may not have an immediate effect on the group’s ability to carry out terrorist attacks outside its territory. While hurting Islamic State finances puts pressure on the organization and its state-building project, wider efforts will continue to be necessary to ultimately defeat it.
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