Reykjavik city fee or city tax?

Icelandic hotels are obliged to collect a fee pr. sold night.

Question: When considering accommodation or hotels costs in Reykjavik, can I expect the actual cost to be higher due to mandatory city fee or city tax?

The short answer is no, there is not city fee or city tax in Iceland. But according to Icelandic law “Every hotel or “seller of accommodation” is required to collect a fee per sold accommodation night. This fee must be stated separately on the invoice for the customer and is subject to VAT.”

When this law was passed in 2010/2011 the fee was ISK100 pr. hotel and ISK 50 pr. for other types of accommodation. Most, if not all, hotels have this fee included in the price and therefore your total hotel bill will most likely be equal to the price shown when you booked.