Parliament voted in favor last night of raising the tax of alcohol and tobacco by 15%, auto tax by 10%, the tax on oil by 5 ISK and the tax on gasoline by 10 ISK.
The vote was fairly evenly split between government and opposition – 32 MPs for the ruling Social Democrats and Leftist-Greens voting in favor and 22 MPs for the Independence Party, the Progressives and the Civic Movement voting against – with one exception: Leftist-Green MP Lilja Mósesdóttir abstained.
Progressive MP Birkir Jón Jónsson called the ruling coalition “out of touch with the people.” MP Eygló Harðardóttir, of the same party, claimed that the Confederation of Icelandic Labour Unions and the Confederation of Icelandic Employers, who met with the Economic and Tax Committee last night, also expressed opposition to the measure.
Civic Movement MP Þór Saari said that the bill was proof that the ruling coalition was being pressured by the International Monetary Fund to produce some sort of results, and instead produced “this poorly-worked bill.”
Helgi Hjörvar, an MP for the Social Democrats, defended the bill, saying that there are a number of cuts that need to be made to balance the budget, and the increase of the taxes on alcohol, tobacco and fuel are measures made in this direction.
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