Iceland switched to a per-kilometre road tax
From 1 January 2026 Iceland replaced part of its fuel tax with a per-kilometre road tax on all vehicles, about 6.95 ISK per km at the government rate, with rental companies typically adding an admin margin to around 8.8 ISK per km, billed after you drop the car off.
Why it matters: A full Ring Road loop of roughly 1,500 km can add about 13,200 ISK, around 105 dollars, to a rental, and it lands on your card after the trip rather than in the booking price.
Iceland money guideThis is the permanent record of one change. The current fact lives on the guide linked above, which is re-checked on a schedule. For how we check and correct, see our methodology.