Iceland considers imposing new taxes to curb overcrowding

Published on : Tuesday, March 21, 2017

IcelandTouted to be world’s hottest and most expensive holiday destinations, Iceland could soon become more expensive. In spite of being far-flung, Iceland gets record number of visitors. This is making Iceland’s government consider raising taxes for the tourism sector. This would be to limit the access of sightseers to the country’s most popular tourist spots.

To quote Thordis Kolbrun Reykfjord Gylfadottir, Iceland’s tourism minister, “The sector and all of us have to be careful not to become victims of our own success.” The tourism boom for Iceland can be attributed to a currency fall and and its location for scenes featuring in the popular TV series Game of Thrones. Visitor numbers are growing increasingly from 490,000 in 2010 to an estimated 2.3 million this year. That is quite large considering Iceland’s sparse population Tourism is now the Iceland’s main export, bringing in around 45% of foreign exchange — or $5.1 billion (560 billion kroner) — in 2017, according to Islandsbanki, the country’s second-largest lender.

However, overcrowding might ruin experience for visitors and destroy natural treasures. Among the country’s most popular destinations are Thingvellir, a UNESCO World Heritage Site, and Jokulsarlon, an otherworldly glacier lagoon on that island’s southeastern coast now at the center of a legal dispute.


The coalition government is considering a number of options. They include forcing bus companies and tour operators into buying a special license or hiking the existing levy on hotel rooms. Any tax hike would add to the already high bills that tourists are paying for visiting the country. The ministry says proceeds of any new levy would be used to improve infrastructure and facilities. However, Gylfadottir said, “We also need to ensure that tourists that come here get a positive experience during their stay.”


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