Government proposes per-kilometer fee for all vehicles in bid for sustainable transportation financing

A per-kilometer fee will be introduced for all vehicles from the beginning of next year if a bill by the government becomes a reality. This measure had already been introduced at the start of the year for electric, hydrogen, and hybrid vehicles.

The Finance and Economic Affairs Ministry has proposed the measure for discussion to introduce the per-kilometer fee for all vehicles from the start of next year. The draft bill for the same will be presented at the autumn parliament session. The intent of the bill is to have a per-kilometer fee paid for the use of all vehicles in the road system depending on the number of kilometers driven.

The government states that successful energy transitions require the financing of road transport to be independent of fossil fuels. The goal is to ensure sustainable financing of road transport alongside energy transitions.

The per-kilometer fee will replace oil and gasoline charges and will be paid monthly based on an estimate of average monthly driving and adjusted when the vehicle’s mileage is registered on an Iceland-based platform or at a specialized inspection office.

This initiative is another move towards sustainable transportation.