Planning an Iceland trip and don't know where to start?
Six questions, in the order they matter: when, how long, who with, budget, car or tours, where to sleep. We point you to the answer for each one.
Iceland Road Tax per Kilometer: 2026 Rates & Examples
Road Tax per Kilometer
Iceland's kílómetragjald, explained without the fog
The short answer
From January 1, 2026, Iceland charges a per-kilometer road usage fee called kílómetragjald on every vehicle, no matter what powers it. Electric, hybrid, hydrogen, petrol, and diesel cars all pay the same rate.
Current rate (2026): 6.95 ISK per kilometer for passenger cars and jeeps up to 3.5 tons. Roughly 5 US cents per km, or about 8 US cents per mile.
Heavier vehicles (vans, campers over 3.5 tons, trucks) pay progressively more. The rate is set by Skatturinn, Iceland's tax authority, and reviewed periodically.
If you are renting a car
Most visitors will see this charge through their rental company. The process is simple, even if it looks unfamiliar:
At pickup: The agent records the starting odometer reading.
At return: They record the ending reading. The difference is your kilometers driven.
On your invoice: You will see kílómetragjald as a line item, or rolled into a single final total. It is a pass-through of the legal charge, not a rental company surcharge.
Important: Your final invoice will be higher than the daily rate quoted at booking. This is normal, not a scam. Ask the rental desk how they bill the kilometer charge before you sign the contract, so there are no surprises at return.
What it actually costs on a trip
The rate sounds small per kilometer, but Iceland is bigger than most visitors expect. Some realistic examples:
Keflavík Airport to Reykjavík and back
About 100 km. Cost: roughly 695 ISK (about 5 USD).
South Coast day trip from Reykjavík
About 500 km round trip. Cost: roughly 3,475 ISK (about 25 USD).
Snæfellsnes peninsula loop
About 600 km round trip from Reykjavík. Cost: roughly 4,170 ISK (about 30 USD).
Full Ring Road circuit
About 1,500 km. Cost: roughly 10,425 ISK (about 75 USD).
These are passenger car figures. Camper vans and 4x4s over 3.5 tons will cost more per kilometer. USD conversions use a working rate of 140 ISK per USD and will drift with exchange rates.
Why this charge exists
Iceland used to fund road maintenance largely through fuel taxes. As electric and hybrid cars became common, fuel tax revenue dropped, but the wear on the roads did not. The kílómetragjald shifts part of that funding to a per-kilometer model, so every driver contributes regardless of what their car runs on.
Electric and hybrid owners started paying it earlier (2024 to 2025). From January 1, 2026, it applies universally.
Official sources
Rates and rules change. Always confirm the current figure with the tax authority before relying on a calculation.
Skatturinn (tax authority): skatturinn.is/kilometragjald
Ísland.is (government services): island.is/kilometragjald
Questions visitors often ask
How much is Iceland's road tax per kilometer?
6.95 ISK per kilometer for cars and jeeps up to 3.5 tons. Heavier vehicles pay progressively more.
Do electric cars pay the same kilometer tax as petrol cars in Iceland?
Yes. From January 1, 2026, the kílómetragjald applies to every vehicle regardless of fuel type. Electric, hybrid, hydrogen, petrol, and diesel cars all pay the same per-kilometer rate.
Will my rental car charge me for kilometers?
Yes. The rental company reads your odometer at return and bills you for the kilometers driven. This is the legal kílómetragjald, not a rental surcharge.
How much will it add to my road trip?
A full Ring Road of about 1,500 km adds roughly 10,425 ISK (about 75 USD). A south coast loop of 500 km adds about 3,475 ISK (about 25 USD).
Is this the same as the old fuel tax?
No. It replaces part of it. Fuel is still taxed at the pump, but a portion has shifted to the per-kilometer model so that electric and hybrid drivers also contribute to road funding.