Helgason urges film-style support for tourism

Tourism should receive measures to strengthen its international competitiveness instead of facing further tax increases, Jens Garðar Helgason argues in an opinion piece published by Morgunblaðið.

Icelandic authorities have reimbursed part of film production costs in the country for more than two decades. The refund ranges from 25 to 35 per cent, depending on the size of a project. The scheme is intended to support domestic culture and promote Iceland’s history and nature through temporary support for films and television programmes produced in the country.

Helgason says the scheme was designed both to support Icelandic filmmaking and to help the country compete for foreign productions. He suggests that Dalvík may have been chosen to portray a town in Alaska in the series True Detective because of the refund, which he says amounted to about four billion Icelandic krónur for that production.

He contrasts that support with planned or increased charges on tourism, which he says competes with countries including Norway, Scotland and Finland. A bathing tax, higher infrastructure charges, an accommodation tax and a new nature pass would add about 11 billion krónur in taxes on the sector, he writes. The industry as a whole made 20 billion krónur in profit in 2024, according to Helgason.

He also says a nearly 16 per cent increase in the mileage charge will hit car rental companies particularly hard. Those companies help distribute visitors around the country, where they use accommodation, restaurants and other services that have created thousands of jobs, he writes.

Helgason says most European countries place tourism in a lower value-added tax bracket to improve its competitiveness. He is vice-chair of the Independence Party and a member of parliament for the Northeast constituency.