Travellers to Iceland will be paying more for hotels and food as the country’s government proposed a rise in its Value Added Tax (VAT) from the current seven percent to 25.5 percent.

While many other items in the country currently include 25.5 percent VAT, hotel rooms, road tolls, food and some other items had a reduced VAT of seven percent.

The increase in tax is expected to hit Iceland’s tourism industry hard, according to the Examiner.

Other European countries have recently increased the VAT including Spain and Italy who both raised their VAT to 21 percent.