Iceland plans tax increases and new tourism fees for 2027

Iceland is preparing significant fiscal and structural changes set to take effect in 2027. A proposed budget includes adjustments to personal tax allowances and income tax thresholds. While tax rates themselves may remain unchanged, the Starfsgreinasamband Íslands (SGS) warns that slower updates to these thresholds and allowances will result in an effective tax increase of approximately 3.1 billion ISK for individuals.

Additionally, the government plans to raise various state fees by 5.2 percent due to inflation. Notably, mileage reimbursements are projected to rise by 15.9 percent to increase transport revenue.

In the tourism sector, a new nature and infrastructure fee is being introduced. Starting May 1, 2027, tourists visiting the Golden Circle—specifically Gullfoss waterfall, the Geysir geothermal area, and Thingvellir National Park—will be required to purchase a digital pass via QR code. During the peak season (June 1 to October 30), the pass will cost 4,500 ISK per person, while the off-season price will be 3,000 ISK. These fees are intended to generate billions of krona annually and will not apply to Icelandic citizens or foreign residents living in the country.