Iceland trip cost increases with introduction of new tax: Details inside

VIK - The Prime Minister of Iceland has confirmed the imposition of a tax to reduce the impact exponential growth in tourism has on its pristine wilderness.

“Tourism has really grown exponentially in Iceland in the last decade and that obviously is not just creating effects on the climate,” Jakobsdottir said in an interview with Bloomberg.

The tourism tax is being implemented across the world on the pretext of saving nature and Iceland is the fresh entrant to the list of countries charging tourists.

As far as statistics are concerned, Iceland welcomed over 8.5 million visitors in 2022, years after it suffered a blow due to COVID-19.

The numbers released by Statistics Iceland confirm that in June 2023, a total of 1,176,600 overnight stays were registered in the country which is a 17 per cent increase from June 2022.

Regarding the net amount to be paid by the tourists, the prime minister did not reveal the exact figure but clarified that the tariff would not be high and would be implemented as city taxes for those staying in Iceland.

'We have announced that we are putting increased taxes on tourism in Iceland. Not high taxes to begin with, but we are talking about city taxes, etcetera, for people who stay in Iceland,' he said.

Tourism taxes are the new normal in the developed world and have been introduced by authorities in Venice, Italy, the UK besides other countries.

Recently, Manchester became the first UK city to impose a tourist tax and everyone who stays in a city center hotel or holiday apartment has to pay £1 per night, per room.

Moreover, Indonesia's top tourist spot, Bali might not be free for all as the government has decided to tax the tourists from next year; a tax worth 150,000 rupiah ($10) will be imposed on tourists from next year in an effort to preserve its culture and raise funds. 

Moreover, the capital city of Scotland,  Edinburgh is poised to become the first council in the UK to implement a tourist tax, following in the footsteps of other tourist destinations across the world. 

The Scottish Government recently introduced the Visitor Levy (Scotland) Bill, outlining the framework for councils to levy such a tax aimed at generating additional revenue to address the city's growing expenses.

The Edinburgh City Council has expressed its intention to implement such a levy and has initially agreed upon a charge of £2 per person per night, capped at seven nights. Though the final model is yet to be decided, the estimated revenue from this levy ranged from £5 million to £35 million per year.

Top European destination, Venice is also planning to start charging an admission fee becoming the fresh tourist hotspot to introduce such a 'tax'.  

The city council said recently that the fee would be charged from next year to try to manage the flow of tourists coming to the historic canals.

It has been announced that the admission fee will be applied on a trial basis for 30 days in 2024, focusing mainly on spring bank holidays and summer weekends when tourism is at its zenith.