According to the 5-year fiscal plan, which the Icelandic government revealed yesterday, carbon taxes will be raised by 10% next year, and again by 10% in 2020. Taxes and duties on environmentally friendly vehicles will be lowered even further. Import duties on vehicles will be progressively higher based on their CO2 emissions. The steps are taken as part of Iceland's commitment under the Kyoto protocol and the Paris accords.
Currently the carbon tax on diesel fuel is 12.6 ISK per liter (0.48 USD per gallon/0.1 EUR per liter) and 11 ISK per liter on petroleum (0.42 USD per gallon/0.09 EUR per liter). This is on top of other taxes levied on transportation fuels.
Read more: 2018 Budget surplus will be 1.6%. Higher carbon taxes, tax-breaks for electric cars announced
Yesterday afternoon Katrín Jakobsdottir, the Prime Minister of Iceland, introduced the fiscal plan for the years 2019-2023, which is supposed to serve as a blueprint for annual budget for those years. The plan envisions massive increases in infrastructure investment and spending on health care and education. The plan also envisions an annual budget surplus around 1% of GDP each year during the period.
Environmental issues and action to tackle global climate change feature prominently in the plan. Government spending on various environmental issues is projected to increase by 35% compared to last year's budget. Among the items are a new National Park covering the entire Central Highlands, the hiring of large numbers of new Nature Rangers and aggressive steps to make Iceland carbon neutral by 2040.
Read more: Fourth of all new cars in Iceland now electric vehicles
The plan envisions various tax incentives which are supposed to encourage private consumers as well as businesses to choose electric- or other environmentally friendly vehicles. People will be encouraged to trade in vehicles which have low fuel-economy by offering a partial or full rebate on taxes and import duties on such vehicles when they are taken off the road.
According to the 5-year fiscal plan, which the Icelandic government revealed yesterday, carbon taxes will be raised by 10% next year, and again by 10% in 2020. Taxes and duties on environmentally friendly vehicles will be lowered even further. Import duties on vehicles will be progressively higher based on their CO2 emissions. The steps are taken as part of Iceland's commitment under the Kyoto protocol and the Paris accords.
Currently the carbon tax on diesel fuel is 12.6 ISK per liter (0.48 USD per gallon/0.1 EUR per liter) and 11 ISK per liter on petroleum (0.42 USD per gallon/0.09 EUR per liter). This is on top of other taxes levied on transportation fuels.
Read more: 2018 Budget surplus will be 1.6%. Higher carbon taxes, tax-breaks for electric cars announced
Yesterday afternoon Katrín Jakobsdottir, the Prime Minister of Iceland, introduced the fiscal plan for the years 2019-2023, which is supposed to serve as a blueprint for annual budget for those years. The plan envisions massive increases in infrastructure investment and spending on health care and education. The plan also envisions an annual budget surplus around 1% of GDP each year during the period.
Environmental issues and action to tackle global climate change feature prominently in the plan. Government spending on various environmental issues is projected to increase by 35% compared to last year's budget. Among the items are a new National Park covering the entire Central Highlands, the hiring of large numbers of new Nature Rangers and aggressive steps to make Iceland carbon neutral by 2040.
Read more: Fourth of all new cars in Iceland now electric vehicles
The plan envisions various tax incentives which are supposed to encourage private consumers as well as businesses to choose electric- or other environmentally friendly vehicles. People will be encouraged to trade in vehicles which have low fuel-economy by offering a partial or full rebate on taxes and import duties on such vehicles when they are taken off the road.
