Icelandic union leader calls for 2.5% price cap

Vilhjálmur Birgisson, chairman of the Craftsmen's Union and the Akranes Labor Union, is calling on the Icelandic government and service sectors to adhere to a 2.5% price cap on general tariffs. This follows a decision by the Association of Icelandic Municipalities to aim for tariff increases within this limit for the coming year.

Birgisson argues that while reducing planned increases from 5.2% to 2.5% and cutting specific kilometer fees would cost the treasury approximately 7.4 billion ISK, the economic benefits could be double that amount. He notes that if collective efforts reduce inflation from 5.6% to 3.5%, the reduction in indexation costs for the state's 744 billion ISK in inflation-indexed debt would amount to roughly 15.6 billion ISK annually. He emphasizes that the responsibility for controlling inflation must be shared by the government and the service industry rather than falling solely on workers.