Iceland Proposes Taxes for Tourists

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After the perfect storm of Game of Thrones filming, a currency plunge, IcelandAir flight specials, and lots of #wanderlust Instagram posts featuring the country’s waterfalls and moss-covered cliffs caused a massive spike in tourism for Iceland, the island nation is trying to make tourism a bit more lucrative.

In 2010, a mere 490,000 people visited Iceland, compared to the 2.3 million tourists who are estimated to make the journey to the land of fire and ice this year.

Sure, it’s been great for the economy — especially when the average cab ride from the Keflavik airport to the city center of Reykjavik costs $150, gas for your rental car will run you about $7.50 a gallon, and the cheapest beer you’ll find is around $10 — but when the total population of a country is less than 350,000, then 2.3 million tourists feels like throwing a party in a shoebox. There just isn’t enough room.

“Some areas are simply unable to facilitate 1 million visitors every year,” Thordis Kolbrun Reykfjord Gylfadottir, Iceland’s tourism minister, said during an interview in Reykjavik. “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.”

So to preserve the country’s natural beauty and resources from the tromping feet of two million tourists too many, there’s a new proposal to raise taxes in the tourism sector. Currently, all “attractions” (like geysers, ice lagoons, black sand beaches, national parks, and waterfalls) in Iceland are free to visit and enjoy, so imposing taxes and fees would curb the numbers of visitors while still bringing in money. The alternative option would be to limit the number of visitors to each attraction (or even the country itself).

“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 added. “We also need to ensure that the tourists who come here get a positive experience during their stay.”

The excess charges and new tax proposal has come on the coattails of a previous attempt by Iceland’s former government officials to enact a bill that would have required all visitors — domestic and foreign — to purchase a “nature pass” priced at $14.

Now the coalition government has mentioned requiring buses and tour operators to buy a special license, as well as increasing the already expensive prices of hotel rooms. These taxes will hike prices for nearly all areas of purchase for visitors — from meals to accommodations and sightseeing — instead of acting as a one-stop shop for an extra fee for traveling to the country.

Seems like enough to curb plenty of penny-pinching travelers’ enthusiasm for visiting Iceland — especially when other, more spacious and less-expensive European destinations such as Spain and Portugal are just a plane ride and a $321 round-trip ticket away.

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