Minister Defends Higher Taxes on Accommodation Skip to content

Minister Defends Higher Taxes on Accommodation

Minister of Industry and Innovation Steingrímur J. Sigfússon iterated at the Icelandic parliament, Alþingi, yesterday that there are strong arguments for taxing accommodation in the same way as food and cultural activities and that it is right to increase the tax—the tourism industry is doing well and could handle it, he reasoned.

steingrimurjsigfusson_pkSteingrímur J. Sigfússon. Photo by Páll Kjartansson.

According to, the number of accommodation nights in September 2012 is up by 15 percent compared to the same month last year, totaling 156,000. The highest increase, 30 percent, was reported in North Iceland.

However, Steingrímur added he agrees with critics of the move who argue that it is too big a step to raise the VAT on accommodation from 7 to 25.5 percent in one go and this is still under consideration, he stated, reports.

Steingrímur’s statement came in response to an enquiry by chairman of the opposition’s Progressive Party Sigmundur Davíð Gunnlaugsson, who asked the minister at parliament whether he was prepared to review plans for higher taxes for the tourism industry.

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