Rules about taxis

Taxi driving is permit required activity and is subject to the Taxi Driving Act no. 120/2022 and Taxi Driving Regulation no. 324/2023.

Please note that amendments to the Taxi Act No. 120/2022 will take effect on June 1st 2026. Further information on the main changes is available on the website of the Icelandic Transport Authority.

The following provides an overview of the main obligations of permit holders under the provisions of this act and regulation.

Identification of taxis

• Taxis must always be clearly identified so that there is no doubt that it is a taxi

• A taxi that is driven according to a meter must be identified by a roof light

• A taxi that is driven according to a pre-agreed total price must be identified with a license sticker issued by the Icelandic Transport Authority in the taxi's windshield

• A taxi operating shall be marked with the taxi station’s emblem low in the center of the front windshield. In addition, the station number shall be clearly visible in the upper left corner of the rear windshield

Price meter or pre-agreed estimated total price

Certified taximeters shall be installed in all taxis that are hired for a price based on the distance travelled or the duration of the journey (not for pre-agreed total price).

It is permitted to drive without a taximeter when a journey is sold for a pre-agreed estimated or final total price. The operating permit holder or, if applicable, the taxi driver must be able to prove that the total price was agreed upon before the journey began.

Visibility of price list and license card

When driving according to the taximeter, the price list must always be visible and accessible to customers before entering the taxi and also inside the taxi.

When a journey is sold for a pre-agreed total price, the price list and the criteria on which the agreed total price is based must be accessible to the customer so that it is clear how the pricing is determined. For example, when the service of a taxi is booked in advance for example through a website or an app, price information must be clearly displayed before the consumer orders the taxi service.

The license card of the taxi operating permit holder or the taxi driver permit holder must always be visible in the taxi.

Obligations of taxi stations

Taxi stations shall ensure the recording of satellite data in their electronic records:

• Record all trips electronically, including information on the start and end of the trip, the route, and payment

• The electronic record shall be maintained solely for the purpose of ensuring safety and promoting consumer protection

• The processing of location data for other incompatible purposes is prohibited

• Location data shall be encrypted and retained for 60 days from the completion of the trip

• The Icelandic Transport Authority may request data from the electronic record as part of regular supervision or as needed

• The electronic recording systems of taxi stations shall undergo an annual audit by an independent party approved by the Icelandic Transport Authority

Taxi stations must also provide a complaints procedure. Passengers must be able to report unreasonably high fares or poor service, and taxi drivers are required to inform passengers of these rights.

Taxi equipment

A taxi must meet the general requirements for cars according to traffic laws and regulations:

• A three-point seat belt must be worn in all seats of a taxi

• A taxi must be equipped with a fire extinguisher and a first aid kit

Registration of a taxi in the vehicle register

• A taxi must be registered as such in the vehicle register

• The taxi operator permit holder must be the registered owner or occupier of the taxi
  

Good business practices

The taxi operating permit holder is responsible for operating a taxi in accordance with good business practices.