Iceland Mag

9 Reykjavik

Iceland Mag

Business

Icelanders unsure how to respond to the growing prevalence of tipping

By Staff

  • Tip jar Icelanders don't tip but with the growing number of tourists the practice has become more common in the service industry.

Tipping for services in Iceland was virtually unkown until recently. With the explosive growth in tourism in the last few years, Icelander's are now dealing with how to respond to the increased prevalence of tipping.

While it is perfectly acceptable to tip staff in the service industry in Iceland, locals never do. In restaurants, prices on the menu are all-inclusive and there is no tradition for tipping. However, many of the tourists who visit Iceland are accustomed to tipping and leave waiters or tour guides money for good service. With the boom in tourism, the practice has become much more common in recent years. 

Friction with people who benefit from tips
Some locals have tried to warn foreign tourists against tipping, but that has caused friction with people employed in the tourism industry who benefit from this new trend of tourists tipping them for their service.

According to a report by local news site Vísir, not everyone in the tourism industry is in favour of tipping either. Friðrik Pálsson, owner of Hótel Rangá, says he's annoyed that a culture of tipping is taking hold in Iceland.

"I'm absolutely against tipping."

Read more: Tipping in Iceland, does it exist? 

The commissioner for Inland Revenue told Vísir that service employees who benefit from tipping must report it as income on their tax returns. It is only recently that his office has had to look into revenue generated by tipping. He says that it's impossible to tell if workers generally report the tips they receive as there is no specific field for tips on Icelandic tax returns.

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