Iceland Replaces 40% Flight Discount with ISK 7,000 Subsidy

Iceland will replace the Loftbrú scheme's 40% fare discount with a fixed ISK 7,000 subsidy per flight leg from the new year.

• 1A fixed ISK 7,000 subsidy per eligible flight leg replaces the 40% discount from the new year
• 2Residents keep support for up to six legs a year, worth ISK 14,000 per return trip regardless of ticket price
• 3The government said 2025 spending exceeded the ISK 600 million budget by ISK 140 million
• 4About 62,000 people qualify and roughly 80,000 subsidised journeys were taken in 2025