Iceland introduces dynamic tourist fee

23-06-24

Iceland seeks to regulate the influx of tourists in high season with a variable tourist tax, adjusting the price according to demand.

Nothing has slowed tourism in Iceland in recent years. Neither the pandemic nor frequent volcanic eruptions have deterred visitors. In 2023, the country welcomed around 2.2 million tourists, almost six times its population, generating 598 billion Icelandic krónur in export revenue (about €4 billion). This represents almost a third of total annual exports, according to the Bank of Iceland, and tourism constituted 8.5% of GDP.

Despite the economic benefits, tourist overcrowding is a challenge. As a result, Iceland already charges a nominal fee of 600 krona (about €4) from hotel guests to fund sustainability programs. However, Prime Minister Bjarni Benediktsson has indicated on CNBC that they could switch to a system where those who use tourism resources the most pay the most.