Embarrassment is what you feel when you face anyone claiming pending taxes you weren’t aware of. Picture yourself in a heaven sent vacation on a unique island full of nature, golden sand beaches, premium resorts, with an amazing gastronomy, and right when you have to leave such marvelous place, after what you could describe as a perfect holiday, forced to return to reality, the first negative impact you will suffer would be that uncomfortable situation in which the receptionist of the five star hotel reminds you not everything was paid: «Sir, you need to pay the Tourist accommodation regional tax». After such statement several thoughts will surely come to your mind giving you a bittersweet sense:
Is this some sort of scam? Why haven't I been informed properly by the travel agency? Should I demand further explanations? It is not a high amount, but what if it is just the receptionist trying to make profit?
For sure this scene doesn't seem to be the best way to end a dreamlike vacation and one of the worst feelings as tourist is that you are being conned. Ignorance puts you in a very vulnerable position and turns you an easy target for crooks and rogues. Unfortunately the scenario we have just described it is not based on a resentful employee or a racket system against tourists, but institutionalized way some regional Spanish governments have come up with to squeeze the tourists wealth.
Now that the travel-industry peak season has passed we can take a look at some of the statistics of these past months in Spain. During 2016 (official information only published until the end of August) the aggregated annual variation rate of tourists visiting our country has increased, compared to the previous year, over 10%, which certainly means that tourism industry is still crucial for Spanish economic growth. So the question we must put to ourselves should be how can we ensure this source of income. Is it a smart approach to fleece Spain's client number one: tourists?
The six regions that received more visitors during this past years -even during the economic crunch- are Catalonia, Balearic and Canary Islands, Andalusia, Madrid and the Region of Valencia, and half of them have already established -or planning to do so- an economic burden over any kind of tourist, despite if it is national or foreigner.
The pioneer in this tax policy was the Balearic government back in 2002/2003. During that time the regional public treasury managed to boost their revenues with an extra amount of 160 million Euros thanks to the so called Ecotax ("Ecotasa"), meant to finance maintenance and establishment of new green areas and natural landscapes. Even when we could all agree that it is important to invest in protecting the environment and natural wonders of places such as "Serra de la Tramuntana" or one of the best preserved coastal fortresses at Dalt Vila (Ibiza), the argument is served when it comes to how this cost should be financed. In deed after the Ecotax had been abolished, the socialist party brought this form of taxation back to live past 1st of July.
Following said initiative, Catalonia added four years ago to its regional tax system, through the approval of the 5/2012 Law of tax, financial and administrative measures, a specific Tourist accommodation tax (Impuesto sobre estancias en establecimientos turísticos). In this case rates go from 0,45 up to 2,25 Euros, and applies to any sort of tourist accommodation, cruises included -only if the liner stays for more than twelve hours anchored in a port inside the area of Catalonia-.
The last region to join this tax greediness is Valencia. They created a special commission formed by experts from the Regional Revenue Agency to study the convenience of creating a similar tax for the year 2017. Tourism lobbyists made their immediate move supported by the Tourist councilor of the Region and seems that the proposal had to be discarded, at least for now.
What seems clear is that regional governments are no better than local or national authorities, and are always seeking "creative" ways to increase their revenue, though it is a pity that such brainstorming never helps to come up with forms of promoting economic growth or investments in lucrative businesses . Politicians always put a special effort in creating economic burdens that have nothing to do with economic wealth but just an easy way of obtaining immediate cash. So when it comes to "withdrawing money" from one of Spain's main economic inputs -tourism- we should be extra careful on the effect that this 'easy income' might have, because experience tells us that tourism industry is nowadays more competitive than ever, thanks to improvements on transportation, free-transit spaces, etc. so any additional cost or burden will have, for certain, its consequences.
Tourism should be treated no different from any other business industries:
- Remove any administrative barrier.
- Easy access to promoting high quality projects/developments.
- Complete and accessible information (many regional official websites are not even translated to English)
- Reduce taxes that will make our country a more appealing option compared to other competitors.
We must not loose sight of the fact that any tax impact, specially when other near neighbors or similar destinations to Spain are not making use of these taxation forms, will always have a negative effect and make tourists believe that maybe Spain is not a paradise after all, but just another ordinary place were tax lust is the general rule.