PM: Fee increases could be smaller if talks go well

PM Kristrún Frostadóttir says the government's announced fee increases could be smaller than previously stated, if tripartite talks with employers and unions go well. The government's announced fixed-amount increases are in line with inflation of just over 5 per cent, rather than the 2.5 per cent inflation target. Examples of fixed-amount fees are alcohol, tobacco and nicotine duties, the per-km charge, and vehicle taxes. The increases have been subject to considerable criticism, particularly from labour market representatives. Kristrún was a guest of Páll Magnússon on Sprengisandur on Bylgjan yesterday morning. She said the government's fixed-amount increases had been among the issues discussed in tripartite talks this summer. Those discussions were more constructive than they often appeared from the outside. Kristrún says a decision was taken during those talks to wait until the autumn before reaching agreement on measures. Talks are therefore still under way over benchmarks for fee increases. She did not, however, reveal whether she would accept any such proposals. In the interview, Kristrún also discussed Iceland's application for EU membership. She said the government had disc