Iceland holiday warning as new cruise ‘ban’ could see tourists abandon country

A new tax threatening to drive cruise passengers away from Iceland has been described as a "cause for concern" by an industry body.

Authorities in Iceland introduced the fee for cruise passengers of £14.35 (2,500 ISK) per person for every 24 hours from January 1.

The tax will be taken regardless of when a cruise to Iceland was booked and will go towards funding infrastructure on the island.

A reported five-fold increase on past charges, the move sparked complaints from some cruise companies and the Cruise Lines International Association (CLIA), which described the tax as a "cause for concern".

It said: "This fee is disproportionate compared to similar charges in the travel and tourism sector, while the revenue is not directed towards communities in the rural areas.

"We are calling on the new Government to address these concerns and ensure that decisions regarding port fees enhance the experience for travellers while directly benefiting local communities and supporting sustainable growth."

The CLIA said it wanted a balanced approach which supports the tourism industry and local communities. Iceland's Ministry of Finance and Economic Affairs has said the significant increase in international cruise ship voyage numbers has hurt domestic tourism firms, particularly because cruise ships were paying "limited taxes".

The country saw a record 306,310 international cruise ship visitors in 2023, the most recent figures from Statista show. Before a Covid pandemic lull, the figure had risen from 62,700 in 2011 to 188,600 in 2019.

Ports in Iceland have reported a reduction in bookings, with Jökull Ólafsson, the chairman of the ports association Cruise Iceland, telling the Independent in late January some popular ports have seen 17% fewer bookings.

Icelandic broadcaster RÚV has reported harbourmasters in the ports Grundarfjörður, Vestmannaeyjar, Akureyri and Faxaflói have reported cancellations.

Norway is reportedly also looking at a measure similar to Iceland's, according to the Telegraph, as a number of countries examine ways of handling pressures from the cruise industry.

Venice has introduced a limit on the size of ships which can dock in the city; Amsterdam is capping cruise ship visits, and Barcelona has closed one of its terminals and limited ship numbers to seven.

Outside Europe, opposition to cruise ships is said to be increasing in Maine, Florida, Mexico, Alaska and French Polynesia.