Monday 22 April 2019

Is Iceland about to become even more expensive for travellers?

Tourist tax

Blue Lagoon, Iceland. Photo: Deposit
Blue Lagoon, Iceland. Photo: Deposit
Reykjavik. Deposit photos
Jeep Safari in Iceland

Gavin Haines

Already one of the world’s most expensive destinations, Iceland is considering a new tax on tourists to prevent overcrowding.

The country has witnessed a near fivefold increase in tourism since 2010 and is looking at ways of limiting the number of foreign arrivals. Hitting holidaymakers in the wallet is certainly one way of doing that.

In an interview with Bloomberg, Iceland’s tourism minister, Thordis Kolbrun Reykfjord Gylfadottir, warned that the country is in danger of being overwhelmed.

“The sector and all of us have to be careful not to become victims of our own success,” she said.

Iceland, which has a population of just 332,000, welcomed 490,000 foreign visitors in 2010. This year that figure is set to rise to a whopping 2.3 million – and that, says Gylfadottir, is not sustainable.

“Some areas are simply unable to facilitate one million visitors every year,” she said. “If we allow more people into areas like that, we’re losing what makes them special – unique pearls of nature that are a part of our image and of what we’re selling.”

Reykjavik. Deposit photos
Reykjavik. Deposit photos

The Icelandic government is considering a range of measures to limit tourism, all of which are likely to push up the price of a holiday to the country.

They including increasing the existing hotel tax – which raised a reported 400 million króna (€3.38m) for the country’s coffers in 2016 – forcing tour operators to purchase licenses and imposing limits on the number of people who can visit certain sites.

The government claims money raised through any such initiatives would go towards improving infrastructure and facilities.

“When we talk about charging for access, to me that relates more to controlling the number of people entering particular areas – which we need to do,” Gylfadottir told Bloomberg. “We also need to ensure that tourists that come here get a positive experience during their stay.”

Tourist taxes are seldom popular, but they are likely to prove particularly contentious in Iceland, which is already extremely expensive for foreigners.

“When I went in February costs were prohibitively high – try €11-plus for a pint of beer,” said Hugh Morris, a travel journalist with The Telegraph. “Dinner at even reasonable establishments always seemed to nudge towards the triple figure mark.”

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