Proceedings in the Balearic parliament are much like any other parliamentary proceedings. There's a good deal of noise, a good deal of superficial waffle and relatively little light. And this sounds rather like the current government. At present at any rate. Meat has yet to be put onto bone. The fleshing-out has yet to truly start, assuming it does before Podemos manage to bring it crashing down. But President Armengol made an observation this week which does shed some light. Or at least light on how she, and so presumably PSOE, perceive the tourist tax.
Lurking in the background is the thought (hope, some would put it) that Armengol will rediscover the reluctance to commit to the tax that she had before the election. As she would totally destroy the government were she to turn her back on it - Podemos' removal of support she might be able to survive but not that of Més as well - we have to assume that there is no turning back, but what she had to say about the tax highlighted, not for the first time, the divergence of opinion between the government's partners as to its purpose.
The tax was being discussed in the context of general fiscal policy. As usual, there was all the stuff about the deficit. Because of Madrid's inflexibility, the Balearics will have to find alternative means. The first point to be made about this is that, although Armengol has linked the tax to the issue of Balearic financing by the state, she hadn't associated it with the deficit. While the deficit and state financing amount to the same thing in terms of government spend, they are separate issues. So, Armengol has shifted the goalposts to a degree.
The second point, and the more important one, was the context of general taxation policy and the philosophy being applied by the Armengol government. She spoke about the redistribution of wealth between the haves and have-nots of Balearic society, referring to the likelihood of increased income tax for higher earners and rises to other taxes, such as inheritance. But in the same context, she also referred to the tourist tax. By implication, tourists are the haves, and they will be assisting in a redistribution of their own wealth.
She then went on to say that tourists, via the tax, will be showing solidarity with the have-nots, and so was seemingly making the case for the tax to be a means of assisting the government, deprived of all the financing it should get from Madrid and also of a more flexible deficit, in paying for its guaranteed social income and for services paid for out of general tax revenues. The tourist tax will be, or at least this is what Armengol appeared to be saying, just another tax.
This is most definitely not what the vice-president and minister for tourism, Biel Barceló, has been saying. The tax may be used for some tourist-related environmental projects, but fundamentally it is to be one to help with funding tourism infrastructure improvements. This is a very different objective.
The government is going to face, and it really doesn't appear to appreciate this, the devil's own job in terms of PR when the tourist tax is launched. The difficult task has already started, though maybe the government hasn't noticed the broadsides coming from the likes of Thomas Cook and Jet2. But it will become more difficult if there is a perception, rightly or wrongly, that it is no more than a general tax. A specific tax is a difficult enough "sell". But one to pay for the have-nots? Sorry to have to say it, but tourists' sense of social responsibility doesn't, generally speaking, stretch very far: not to the environment nor to the eradication of poverty.
It's not as though tourists aren't aware. Of course they are. But issues of poverty and have-nots are more a touristic thing of less-developed societies. Mallorca doesn't fall into this bracket, especially not when there is such ostentatious wealth and opulence on display in many a resort. Likewise, the environment, and so the genuine meaning of an eco-tax, is something for places where the ecology and the environment can genuinely be seen to be both spectacular and fragile. Jet2's Steve Heapy was right when he alluded to an eco-tax for destinations which are devoted to eco-tourism. Costa Rica is the principal example, and tourists willingly pay for a type of tourism that has been lampooned as being "ego tourism".
The Balearic tax isn't, in any event, an eco-tax, much though the environmentalists GOB would like it to be and much though others might like to believe that Mallorca is an eco-tourism destination, when it quite plainly isn't. So, what is the tax for? Barceló seems to know, but Armengol would appear to have other designs.
Showing posts with label Eco-tax. Show all posts
Showing posts with label Eco-tax. Show all posts
Thursday, September 17, 2015
Saturday, August 29, 2015
Feeling The Heat: Eco-tax
It's been proving to be a hot August for tourism policy-makers. Biel Barceló, the minister for tourism, has been continuing his tour of the resorts this week, visiting Muro to hear about that town's tourism issues. It was an appropriate place to have gone. The vice-president of Playa de Muro's hoteliers federation is the same person who is the president of the Mallorcan hoteliers federation - Inma de Benito. It is a resort which is an interesting case study in the development of Mallorca's beach tourism. It grew later than others and was to escape some of the excesses. Environmental common sense prevailed when the scope of the City of Lakes of Alcúdia was scaled back. That ambitious project, as it had been conceived originally, would have devoured and reclaimed a great deal more of Albufera than was to eventually be the case.
Albufera with its symbolism for the natural environment, and Playa de Muro with its relative modernity and abundance of superior-grade hotels create the perfect context for much of what exercises the minds of policymakers. Tensions do arise, as with all-inclusive and with the golf course which is now highly unlikely to ever be built, but for the most part this is a resort which has a balance between the competing demands of tourism and environment and which has achieved this through a high level of quality - in terms both of hotels and tourist.
It is a resort also, however, which symbolises one serious problem for Mallorca and one to which far too little attention has been given. It is now attracting more because, as is also the case nearby in Alcúdia, the issues of water and sewage have assumed centre stage. These are issues where tourism, the environment, resources, services and infrastructure collide. In a nutshell, they are ones for which a tourist eco-tax might be designed. The provision of water itself is less of a concern (at present anyway), but the means of ensuring quality are of concern, as is also the ability of the existing sewage works - on the edge of Albufera - to cope with the strains of tourism in Playa de Muro and Can Picafort.
Sewage was at the top of the list of subjects for discussion when Barceló was in Muro. It also formed part of the discussion that Benito had the other day with the regional environment minister, Vicenç Vidal. Benito has been consistent in voicing her opposition to the eco-tax, but if the tax is to be introduced, then it has to be spent on what it is intended for. In her opinion, and she is surely right, it has to be directed at general environmental issues linked to tourism: things like water and sewage.
Benito is not so sure that this will happen, though. Indeed she has said that she fears that the tax will end up being swallowed up by the general tax revenue pot and spent on something else. She has referred to the charge on water - introduced by the last government, and one that received almost no publicity - which was earmarked for improvements to water sanitation and infrastructure. Has it been? She wasn't convinced.
Albufera with its symbolism for the natural environment, and Playa de Muro with its relative modernity and abundance of superior-grade hotels create the perfect context for much of what exercises the minds of policymakers. Tensions do arise, as with all-inclusive and with the golf course which is now highly unlikely to ever be built, but for the most part this is a resort which has a balance between the competing demands of tourism and environment and which has achieved this through a high level of quality - in terms both of hotels and tourist.
It is a resort also, however, which symbolises one serious problem for Mallorca and one to which far too little attention has been given. It is now attracting more because, as is also the case nearby in Alcúdia, the issues of water and sewage have assumed centre stage. These are issues where tourism, the environment, resources, services and infrastructure collide. In a nutshell, they are ones for which a tourist eco-tax might be designed. The provision of water itself is less of a concern (at present anyway), but the means of ensuring quality are of concern, as is also the ability of the existing sewage works - on the edge of Albufera - to cope with the strains of tourism in Playa de Muro and Can Picafort.
Sewage was at the top of the list of subjects for discussion when Barceló was in Muro. It also formed part of the discussion that Benito had the other day with the regional environment minister, Vicenç Vidal. Benito has been consistent in voicing her opposition to the eco-tax, but if the tax is to be introduced, then it has to be spent on what it is intended for. In her opinion, and she is surely right, it has to be directed at general environmental issues linked to tourism: things like water and sewage.
Benito is not so sure that this will happen, though. Indeed she has said that she fears that the tax will end up being swallowed up by the general tax revenue pot and spent on something else. She has referred to the charge on water - introduced by the last government, and one that received almost no publicity - which was earmarked for improvements to water sanitation and infrastructure. Has it been? She wasn't convinced.
Saturday, August 22, 2015
Barceló's Cook's Tour
Biel Barceló, the vice-presidential minister for Balearic tourism, certainly knows how to fill the column inches of the local press. You can't miss him as he's all over the media. Is this pure publicity-grabbing? It doesn't seem so. Bear in mind that we are in August, a time when Mallorcan politicians traditionally take to their holiday fincas and disappear into the sultry heat (and occasional rain) of late summer. Barceló has not long been in his post. He hasn't necessarily done anything to deserve a holiday yet, but he has avoided the temptation to relax by doing what all tourism ministers should do - he has been getting around the resorts of Mallorca at the peak period in order to see for himself.
He won't of course see everything, but thus far his Cook's tour of the island has found him in resorts on the east coast and in the south-west. Think what you will of Barceló - and much of the thinking will revolve around the eco-tax - but he appears determined to take his portfolio seriously, to be seen to be taking a genuine interest in the concerns of the resorts which constitute the principal motor of not just the tourism economy but the economy of the whole of Mallorca. He should be applauded.
The contrast with his immediate predecessors is great. Neither Carlos Delgado nor Jaime Martínez went out on such fact-finding missions. Martínez in particular was more at home drawing up legislation, a task that befitted his bureaucratic background: he was hardly a man of the tourism people. Barceló does seem genuinely different, though all the glad-handing with local mayors and others will seem simply like a PR stunt unless it turns into meaningful actions. If badly needed investments for certain resorts result, however, then he will be able to take some of the credit.
Down Calvia way he heard of a desire for an amplification of the British police project, but this is something he should be wary of. He faces a colossal PR challenge with the eco-tax, the consequence of the negative publicity it will be bound to attract in the foreign press - the British, for instance. If, allied to this, greater negativity in the British media is heaped upon Mallorca because of greater numbers of "bobbies", then he could have a double-whammy of poor PR to contend with. Nevertheless, at present he's showing himself to be willing to take close interest in the resorts. We wish him well.
The uncertainty over the timing of the eco-tax is beginning to look less uncertain. A schedule for its introduction, which would seem to now have general agreement, will see its approval by the cabinet in January. This will be followed by its passage through parliament during 2016 with the objective of its being implemented in 2017, albeit a precise time in 2017 has yet to be identified. But if the legislative channel seems less clogged, there remains the fundamental of how the tax will be collected. The option for doing so through ports and airports requires state approval and the practicalities of such an option may leave it dead in the water.
As part of the PR battle to convince everyone of the need and fairness of the eco-tax, a member of Barceló's party, Més, has added his voice to the argument. The deputy mayor of Palma, Antoni Noguera, who will become mayor in mid-term under the pact agreement for governing the city, has attacked hoteliers' portrayal of themselves as "victims" of the tax by alluding to the non-harmful impact of tourist taxes elsewhere. With Berlin, as an example, he is on solid ground, but London? There has been talk of a tax there but by individual councils - both Westminster and Camden have been looking at it. A misunderstanding may arise because of the VAT applied to hotel bills, but Noguera needs to be careful in making comparisons which aren't valid. More appropriate to Mallorca, in any event, are the experiences of the likes of Catalonia, Croatia, Bulgaria and France, though even these are unlikely to cut much ice with many travellers. They are interested in Mallorca alone, not what happens on the Costa Brava or in the Black Sea resorts.
He won't of course see everything, but thus far his Cook's tour of the island has found him in resorts on the east coast and in the south-west. Think what you will of Barceló - and much of the thinking will revolve around the eco-tax - but he appears determined to take his portfolio seriously, to be seen to be taking a genuine interest in the concerns of the resorts which constitute the principal motor of not just the tourism economy but the economy of the whole of Mallorca. He should be applauded.
The contrast with his immediate predecessors is great. Neither Carlos Delgado nor Jaime Martínez went out on such fact-finding missions. Martínez in particular was more at home drawing up legislation, a task that befitted his bureaucratic background: he was hardly a man of the tourism people. Barceló does seem genuinely different, though all the glad-handing with local mayors and others will seem simply like a PR stunt unless it turns into meaningful actions. If badly needed investments for certain resorts result, however, then he will be able to take some of the credit.
Down Calvia way he heard of a desire for an amplification of the British police project, but this is something he should be wary of. He faces a colossal PR challenge with the eco-tax, the consequence of the negative publicity it will be bound to attract in the foreign press - the British, for instance. If, allied to this, greater negativity in the British media is heaped upon Mallorca because of greater numbers of "bobbies", then he could have a double-whammy of poor PR to contend with. Nevertheless, at present he's showing himself to be willing to take close interest in the resorts. We wish him well.
The uncertainty over the timing of the eco-tax is beginning to look less uncertain. A schedule for its introduction, which would seem to now have general agreement, will see its approval by the cabinet in January. This will be followed by its passage through parliament during 2016 with the objective of its being implemented in 2017, albeit a precise time in 2017 has yet to be identified. But if the legislative channel seems less clogged, there remains the fundamental of how the tax will be collected. The option for doing so through ports and airports requires state approval and the practicalities of such an option may leave it dead in the water.
As part of the PR battle to convince everyone of the need and fairness of the eco-tax, a member of Barceló's party, Més, has added his voice to the argument. The deputy mayor of Palma, Antoni Noguera, who will become mayor in mid-term under the pact agreement for governing the city, has attacked hoteliers' portrayal of themselves as "victims" of the tax by alluding to the non-harmful impact of tourist taxes elsewhere. With Berlin, as an example, he is on solid ground, but London? There has been talk of a tax there but by individual councils - both Westminster and Camden have been looking at it. A misunderstanding may arise because of the VAT applied to hotel bills, but Noguera needs to be careful in making comparisons which aren't valid. More appropriate to Mallorca, in any event, are the experiences of the likes of Catalonia, Croatia, Bulgaria and France, though even these are unlikely to cut much ice with many travellers. They are interested in Mallorca alone, not what happens on the Costa Brava or in the Black Sea resorts.
Friday, August 21, 2015
The Boneheadedness Of The Eco-Tax
I know I shouldn't but I can't help myself. Anglicising or finding close similarities to English words from names from other cultures is not very fair. But I fear I have to indulge in this somewhat puerile exercise in the case of the regional minister for transport. I wasn't going to, I really had no desire to, but when I started scratching my own head, I was left with no option. The minister's name is Boned. Not too far removed from the nickname of Oasis's rhythm guitarist or from the American slang which gave the English language an insult and the subsequent noun.
The head scratching had to do with the eco-tax. Not the fact of it, but the preference for its collection. At airports and ports. How the hell's that going to work? It is this preference which leads one to conclude that the regional government and its unfortunately named transport minister are engaging in boneheadedness. Stubbornness, obstinacy, foolishness. They're bringing an eco-tax on themselves, pressing ahead with it, getting themselves deeper into a hole from which they won't be able to escape by burying themselves in the impracticalities of the collection preference.
Sr. Boned would like to have a meeting with the minister for development, Ana Pastor, she the ultimate shepherd(ess) of all who are packed into the pens of arrivals, having obediently followed in their flocks the stark instruction of baggage reclaim. As development minister, she has the final say on all things airports. Boned wants to have a word, to ask her to let the Balearics collect the eco-tax at airports (and ports).
The chances of her agreeing to this are probably slightly less than zero. She is, as the regional government is only too aware, a member of the Partido Popular, with whom the parties of the regional government have their disagreements and differences in ideology. An area of disagreement is the eco-tax. The PP's secretary-of-state for tourism, Mallorca's very own Isabel Borrego, has declared her opposition to such a tax: it is unlikely to curry much favour elsewhere in the PP national government.
Ideology, however, has typically played little part in tourist-tax introduction elsewhere. Catalonia is not a left-wing administration, but it has a tax. If leftism were a pre-requisite, then Andalusia, continuously socialist-led since democracy, would have had one years ago. They don't even really talk about it down there. Ideology shouldn't, therefore, be a factor, but when Pastor is presented with the Boned request, one would trust that one of her questions would be, assuming she is even vaguely minded to agree in principle to the request - how will you do it?
I'm assuming, hoping that the government has actually given this some thought. For example, how does it intend processing eco-tax payment from the some 80,000 arrivals on a busy day in summer? Think about if for a moment, because there are times of days when there are significant peaks in the volume of passengers. What will they do? Have a tax check-in? The mind boggles.
There are other practicalities. How is a tourist distinguished from a non-tourist? It might be easy to identify many a tourist - lads on tour t-shirts, pasty faces and what have you - but there would still have to be some way of filtering. How do they do that? Coming in on a charter plane would make the task easier, but not everyone does. Has the government not noticed the increase in the volume of direct-booked, low-cost air travellers? And not everyone travelling Ryanair is a tourist by any means.
Then there would be the charge. If it is to be, as hinted, one or two euros per night, how do they check the length of stay? Is there to be some sort of stamp to check a tourist in, to be presented on departure in order to verify that the right amount has been paid? Are tourists to be tagged and geo-located in order to check the time they are in Mallorca?
But while these logistical issues - pretty important ones at that - raise all sorts of questions, is there not something altogether more fundamental? Image. Perception. If, as a government, you are introducing a tax system, which will not be universally popular, and you do so by presenting the need for a visitor to hand over money the moment he or she steps on dry Mallorcan land, do you not create a negative perception? If this is then compounded by queuing to make the payment, by some system of verification, then you face almost certain PR disaster.
This is why I'm scratching my head, perplexed by the apparent boneheadedness. But then, they must have thought about all this and will already be hard at work designing a flawless system. If only.
The head scratching had to do with the eco-tax. Not the fact of it, but the preference for its collection. At airports and ports. How the hell's that going to work? It is this preference which leads one to conclude that the regional government and its unfortunately named transport minister are engaging in boneheadedness. Stubbornness, obstinacy, foolishness. They're bringing an eco-tax on themselves, pressing ahead with it, getting themselves deeper into a hole from which they won't be able to escape by burying themselves in the impracticalities of the collection preference.
Sr. Boned would like to have a meeting with the minister for development, Ana Pastor, she the ultimate shepherd(ess) of all who are packed into the pens of arrivals, having obediently followed in their flocks the stark instruction of baggage reclaim. As development minister, she has the final say on all things airports. Boned wants to have a word, to ask her to let the Balearics collect the eco-tax at airports (and ports).
The chances of her agreeing to this are probably slightly less than zero. She is, as the regional government is only too aware, a member of the Partido Popular, with whom the parties of the regional government have their disagreements and differences in ideology. An area of disagreement is the eco-tax. The PP's secretary-of-state for tourism, Mallorca's very own Isabel Borrego, has declared her opposition to such a tax: it is unlikely to curry much favour elsewhere in the PP national government.
Ideology, however, has typically played little part in tourist-tax introduction elsewhere. Catalonia is not a left-wing administration, but it has a tax. If leftism were a pre-requisite, then Andalusia, continuously socialist-led since democracy, would have had one years ago. They don't even really talk about it down there. Ideology shouldn't, therefore, be a factor, but when Pastor is presented with the Boned request, one would trust that one of her questions would be, assuming she is even vaguely minded to agree in principle to the request - how will you do it?
I'm assuming, hoping that the government has actually given this some thought. For example, how does it intend processing eco-tax payment from the some 80,000 arrivals on a busy day in summer? Think about if for a moment, because there are times of days when there are significant peaks in the volume of passengers. What will they do? Have a tax check-in? The mind boggles.
There are other practicalities. How is a tourist distinguished from a non-tourist? It might be easy to identify many a tourist - lads on tour t-shirts, pasty faces and what have you - but there would still have to be some way of filtering. How do they do that? Coming in on a charter plane would make the task easier, but not everyone does. Has the government not noticed the increase in the volume of direct-booked, low-cost air travellers? And not everyone travelling Ryanair is a tourist by any means.
Then there would be the charge. If it is to be, as hinted, one or two euros per night, how do they check the length of stay? Is there to be some sort of stamp to check a tourist in, to be presented on departure in order to verify that the right amount has been paid? Are tourists to be tagged and geo-located in order to check the time they are in Mallorca?
But while these logistical issues - pretty important ones at that - raise all sorts of questions, is there not something altogether more fundamental? Image. Perception. If, as a government, you are introducing a tax system, which will not be universally popular, and you do so by presenting the need for a visitor to hand over money the moment he or she steps on dry Mallorcan land, do you not create a negative perception? If this is then compounded by queuing to make the payment, by some system of verification, then you face almost certain PR disaster.
This is why I'm scratching my head, perplexed by the apparent boneheadedness. But then, they must have thought about all this and will already be hard at work designing a flawless system. If only.
Saturday, August 08, 2015
Beating Borrego: The eco-tax
The twin "causes de la mode" for the Mallorcan tourism industry at present - the tourist eco-tax and all-inclusives - have continued to be at the centre of arguments over the past few days. Stepping into the eco-tax fray has come the highly notable name of Ignacio Vasallo, a leading figure at the national tourism agency Turespaña for many a long year. He has taken issue with the secretary-of-state for tourism, Mallorca's Isabel Borrego, and her comments about the allegedly destructive impact an eco-tax will have. She has said that the previous tax resulted in the loss of one million tourists. In an article I wrote (23 July, http://alcudiapollensa.blogspot.com.es/2015/07/eco-tax-crash-myth-or-not-myth.html), I questioned her figure and the implication she made that the tax was the sole reason for what indeed had been a loss of tourists in 2002.
Vasallo has been making similar points, including the perception among German tourists of that time that they were not welcome in Mallorca, a perception, he notes, that was whipped up by "Bild". Vasallo believes that it doesn't follow that a tax will affect a tourism market (there were various other factors in 2002 - German recession having been a key one), and he notes that it hasn't harmed certain destinations where there is one (Catalonia is an example). The previous tax was opposed, this being a general point, through an orchestrated campaign by the then Partido Popular opposition to remove the PSOE-led administration, and it was one that drew in hoteliers and tour operators.
This was indeed the case, though in all likelihood the PP would have won the 2003 election anyway. But Vasallo's observations carry some weight on account of the fact that he is tourism through and through. The same cannot be said of Isabel Borrego or indeed many other politicians who land tourism portfolios: in Borrego's case, her qualifications for the government post were tenuous to say the least. So, here, in a sense, is a challenge from someone who knows the industry to someone who is just passing through it in a political capacity.
There again, exactly the same can be said of the new government in the Balearics and of Biel Barceló, the tourism minister, and one of the prime preachers of an eco-style tourism perspective, David Abril of Més. Despite the fact that Borrego conveniently ignored factors such as recession that had been an influence in 2002, it cannot and should not be ignored that there was also a political agenda that the 1999-2003 PSOE-led administration had. It was one that had been summed up by the then tourism and environment ministers, when there were allusions to ending mass tourism. At minimum, a reduction in the region of two million tourists had been referred to.
The point is that there are very similar views lurking within the new government. Barceló himself, largely because of one particular press interview, is currently being characterised as moderate. But behind him is David Abril, from the same party (Més), who is less so. Though a new tax might not result in fewer tourists, is there, nonetheless, a policy to seek a reduction in tourism numbers? It has been implied but not overtly stated, but what most certainly has been stated has been the policy pursuit of the "quality" tourist, a being the 1999-2003 administration also craved. In this, there is the link to all-inclusives.
Llucmajor is another town - in addition to Manacor and Calvia - where the changes in regional and municipal administrations have been the backdrop to political demands for all-inclusive regulation and to calls from various associations which now sense that there are administrations more amenable to their cause. One of these is the small to medium-sized businesses association, Pimem. It has called on Llucmajor's mayor, Jaume Tomás, to apply the maximum possible rates on hotels which offer all-inclusive: presumably, this is aimed at Arenal. One fancies that were this to be done, then the lawyers would have a field day.
Vasallo has been making similar points, including the perception among German tourists of that time that they were not welcome in Mallorca, a perception, he notes, that was whipped up by "Bild". Vasallo believes that it doesn't follow that a tax will affect a tourism market (there were various other factors in 2002 - German recession having been a key one), and he notes that it hasn't harmed certain destinations where there is one (Catalonia is an example). The previous tax was opposed, this being a general point, through an orchestrated campaign by the then Partido Popular opposition to remove the PSOE-led administration, and it was one that drew in hoteliers and tour operators.
This was indeed the case, though in all likelihood the PP would have won the 2003 election anyway. But Vasallo's observations carry some weight on account of the fact that he is tourism through and through. The same cannot be said of Isabel Borrego or indeed many other politicians who land tourism portfolios: in Borrego's case, her qualifications for the government post were tenuous to say the least. So, here, in a sense, is a challenge from someone who knows the industry to someone who is just passing through it in a political capacity.
There again, exactly the same can be said of the new government in the Balearics and of Biel Barceló, the tourism minister, and one of the prime preachers of an eco-style tourism perspective, David Abril of Més. Despite the fact that Borrego conveniently ignored factors such as recession that had been an influence in 2002, it cannot and should not be ignored that there was also a political agenda that the 1999-2003 PSOE-led administration had. It was one that had been summed up by the then tourism and environment ministers, when there were allusions to ending mass tourism. At minimum, a reduction in the region of two million tourists had been referred to.
The point is that there are very similar views lurking within the new government. Barceló himself, largely because of one particular press interview, is currently being characterised as moderate. But behind him is David Abril, from the same party (Més), who is less so. Though a new tax might not result in fewer tourists, is there, nonetheless, a policy to seek a reduction in tourism numbers? It has been implied but not overtly stated, but what most certainly has been stated has been the policy pursuit of the "quality" tourist, a being the 1999-2003 administration also craved. In this, there is the link to all-inclusives.
Llucmajor is another town - in addition to Manacor and Calvia - where the changes in regional and municipal administrations have been the backdrop to political demands for all-inclusive regulation and to calls from various associations which now sense that there are administrations more amenable to their cause. One of these is the small to medium-sized businesses association, Pimem. It has called on Llucmajor's mayor, Jaume Tomás, to apply the maximum possible rates on hotels which offer all-inclusive: presumably, this is aimed at Arenal. One fancies that were this to be done, then the lawyers would have a field day.
Saturday, August 01, 2015
The Neglect Of Calas de Mallorca
Calas de Mallorca is a resort that has for years suffered from neglect. Partly this has been because of its origins as an essentially private development which still creates issues for the town hall in Manacor in terms of services. Nevertheless, last year the town hall was stung into taking action when examples of neglect began to appear in the media. So, it showed some initiative, the lack of which has been the focus of criticism of regimes at the town hall over several years when it has come to tourism infrastructure (and not just Calas de Mallorca). It is a resort which has also become a dumping ground for all-inclusive. In this regard it is not unique, but the almost total economy nature of its some 6,000 or so hotel places has bred a form of all-inclusive that reflects the hotel stock and a level of all-inclusive which is said to represent anywhere between 80% and 90% of those places.
The quoting of such figures is always something in which holes can be picked. Data from the Balearic tourism ministry (such as they are) and information from studies give varying percentages as to the level of all-inclusive. A typical figure has been around 33% for the whole of Mallorca, which might just be believable when one takes account of the island's entire hotel stock but is most definitely not believable at the micro level of individual resorts, of which Calas de Mallorca is a good example.
With a new regime at the town hall, the issue of all-inclusive, as it is in other municipalities, has come to the top of the agenda. But like other municipalities, Calvia for example where the mayor has spoken of regulation, Manacor cannot effect any municipal legislation that limits or bars all-inclusive. It can introduce bylaws that might influence aspects of the all-inclusive offer but it can do no more: it is otherwise a matter for regional government.
If the volume of all-inclusive is as it is quoted, there should be a fundamental question being asked: what is the point of Calas de Mallorca as a resort? If general economic welfare is so limited as a consequence of one particular type of accommodation board, then its purpose as a resort is diminished. It is not sustainable, and in the mantra of the current day, it therefore runs counter to the notions of sustainable (aka responsible) tourism that tour operators and some hoteliers make a big issue of, yet singularly fail to practise.
The new regional administration, with its twin policy items of the eco-tax and all-inclusive regulation (yet to be defined), may well have an underlying strategy aimed at reducing tourist numbers. It is a strategy littered with risks, but if these policies, allied to tactics such as the declaration of far more "mature zones" in tourist resorts, were to result in a decline in the number of places in a resort like Calas de Mallorca but the removal of a great deal of that 80 or 90%, then the cost-benefit equation would in all likelihood weigh heavily in favour of general economic benefit for the local economy.
The mature zones, a mechanism for liberalising and incentivising redevelopment but also forcing it, should be applied widely across Mallorca, but it is a tactic which might itself run up against government antagonism towards in-resort investment. What we are not seeing at present is a clear vision of what Biel Barceló, the tourism minister, wants. When he speaks of tourism re-investment facilitated by the eco-tax, how much of this would be directed at the resorts? Even if it were to be, mature zones rely massively on private investment for the tactic to succeed or be given the chance to succeed, and neither Més (certain members of the party at any rate) nor Podemos are currently endearing themselves to the principal sources of such investment - the hoteliers and their backers.
There is a great deal of muddled thinking at present. While reducing tourist numbers, limiting all-inclusive but raising general standards in terms of the type of tourism that Mallorca has are not in themselves bad policies, another side of the coin is that of employment. And into this equation comes the issue of wages, employment conditions and contracts. A report this week that reveals that increased employment levels in the Balearics are predominantly due to short-term, seasonal tourism contracts will come as absolutely no surprise. Podemos, in attacking the hoteliers for a lack of job security, has to accept certain realities of the tourism industry. Firstly, it is seasonal and secondly, there is a very good reason why wages are as they are - low. Podemos (and the government) wants there to be higher quality employment in the industry, implying higher wages, full contracts and so on. But then what is this employment? For the most part, it is unskilled or low-skilled. This shouldn't be an excuse for worker exploitation, but tourism jobs are like they are in Mallorca the world over: that's the reality.
To return to the theme of all-inclusive regulation, it is not one that is only exercising the minds of councillors in Manacor and Calvia and Balearic government ministers. In Benidorm, a commission is being set up to analyse the impact of all-inclusive. The conclusions of its findings will be sent to the regional government (Valencia in this instance). What is significant about this commission is the fact that it involves all interested parties, including the Benidorm hoteliers. Absent from its membership, however, are any tour operators, and as we all know it is they who hold the key, not the hoteliers, many of whom would rather not have to offer all-inclusive (a sentiment which exists in Mallorca as well).
But with the Canaries also setting all-inclusives in their sights, there is a discernible shift in political and business perspective. Finally, after a good couple of decades of all-inclusive there is some momentum and desire to address its impact, and it is a momentum being felt in different parts of Spain. Ultimately, however, the tour operators need to be included, as it is they who wield much of the power. But might they finally wake up to the responsibilities they claim in the marketing-speak of their responsible/sustainable tourism mission statements? Don't hold your breath.
The quoting of such figures is always something in which holes can be picked. Data from the Balearic tourism ministry (such as they are) and information from studies give varying percentages as to the level of all-inclusive. A typical figure has been around 33% for the whole of Mallorca, which might just be believable when one takes account of the island's entire hotel stock but is most definitely not believable at the micro level of individual resorts, of which Calas de Mallorca is a good example.
With a new regime at the town hall, the issue of all-inclusive, as it is in other municipalities, has come to the top of the agenda. But like other municipalities, Calvia for example where the mayor has spoken of regulation, Manacor cannot effect any municipal legislation that limits or bars all-inclusive. It can introduce bylaws that might influence aspects of the all-inclusive offer but it can do no more: it is otherwise a matter for regional government.
If the volume of all-inclusive is as it is quoted, there should be a fundamental question being asked: what is the point of Calas de Mallorca as a resort? If general economic welfare is so limited as a consequence of one particular type of accommodation board, then its purpose as a resort is diminished. It is not sustainable, and in the mantra of the current day, it therefore runs counter to the notions of sustainable (aka responsible) tourism that tour operators and some hoteliers make a big issue of, yet singularly fail to practise.
The new regional administration, with its twin policy items of the eco-tax and all-inclusive regulation (yet to be defined), may well have an underlying strategy aimed at reducing tourist numbers. It is a strategy littered with risks, but if these policies, allied to tactics such as the declaration of far more "mature zones" in tourist resorts, were to result in a decline in the number of places in a resort like Calas de Mallorca but the removal of a great deal of that 80 or 90%, then the cost-benefit equation would in all likelihood weigh heavily in favour of general economic benefit for the local economy.
The mature zones, a mechanism for liberalising and incentivising redevelopment but also forcing it, should be applied widely across Mallorca, but it is a tactic which might itself run up against government antagonism towards in-resort investment. What we are not seeing at present is a clear vision of what Biel Barceló, the tourism minister, wants. When he speaks of tourism re-investment facilitated by the eco-tax, how much of this would be directed at the resorts? Even if it were to be, mature zones rely massively on private investment for the tactic to succeed or be given the chance to succeed, and neither Més (certain members of the party at any rate) nor Podemos are currently endearing themselves to the principal sources of such investment - the hoteliers and their backers.
There is a great deal of muddled thinking at present. While reducing tourist numbers, limiting all-inclusive but raising general standards in terms of the type of tourism that Mallorca has are not in themselves bad policies, another side of the coin is that of employment. And into this equation comes the issue of wages, employment conditions and contracts. A report this week that reveals that increased employment levels in the Balearics are predominantly due to short-term, seasonal tourism contracts will come as absolutely no surprise. Podemos, in attacking the hoteliers for a lack of job security, has to accept certain realities of the tourism industry. Firstly, it is seasonal and secondly, there is a very good reason why wages are as they are - low. Podemos (and the government) wants there to be higher quality employment in the industry, implying higher wages, full contracts and so on. But then what is this employment? For the most part, it is unskilled or low-skilled. This shouldn't be an excuse for worker exploitation, but tourism jobs are like they are in Mallorca the world over: that's the reality.
To return to the theme of all-inclusive regulation, it is not one that is only exercising the minds of councillors in Manacor and Calvia and Balearic government ministers. In Benidorm, a commission is being set up to analyse the impact of all-inclusive. The conclusions of its findings will be sent to the regional government (Valencia in this instance). What is significant about this commission is the fact that it involves all interested parties, including the Benidorm hoteliers. Absent from its membership, however, are any tour operators, and as we all know it is they who hold the key, not the hoteliers, many of whom would rather not have to offer all-inclusive (a sentiment which exists in Mallorca as well).
But with the Canaries also setting all-inclusives in their sights, there is a discernible shift in political and business perspective. Finally, after a good couple of decades of all-inclusive there is some momentum and desire to address its impact, and it is a momentum being felt in different parts of Spain. Ultimately, however, the tour operators need to be included, as it is they who wield much of the power. But might they finally wake up to the responsibilities they claim in the marketing-speak of their responsible/sustainable tourism mission statements? Don't hold your breath.
Thursday, July 23, 2015
Eco-Tax Crash: Myth or not myth?
As you might expect her to, the national secretary-of-state for tourism, Isabel Borrego, isn't a fan of tourist eco-taxes wherever they might be applied. She is of course affiliated to the Partido Popular - it is widely said she got the job because she was chummy with the ex-president of the Council of Mallorca, Maria Salom - and so she would be bound to oppose tourist taxes. Being Mallorcan, she has a particular interest in the plan for a Balearic tax, and she has been voicing her displeasure.
Borrego says that there are "objective data" which show that the new tax would create a loss in tourist numbers. These data relate to the previous tax. It, she says, led to there being one million fewer tourists in the Balearics during 2002-2003. Her objective data are open to question.
What losses did the Balearics incur because of the previous tax? Any? It is true to say, because the Balearic tourism ministry keep very complete records of these things, that there was a fall in tourism numbers in the first year that the tax was applied (it came into effect in May 2002). This decline, though sharp, was not as great as Borrego says: it was just over 550,000 for the whole of 2002. Nevertheless, and QED, the eco-tax meant more than half a million fewer tourists. Well, not necessarily.
Borrego has been speaking about the tax and how it is or will be perceived by the German market. The 2015/2016 version of this market will see itself as being under attack by the tax, one which implies a rejection of the visitor. In this, she is echoing the narrative from a separate issue that arose around the time of the old eco-tax. It was one to do with remarks from the then tourism minister, Celesti Alomar, and president of the Council of Mallorca, Maria Antonia Munar. They gave an implication that German tourism of the 2002 variety was not wanted: or at least a certain type of tourism was not wanted. This had little or nothing to do with the eco-tax. It had everything to do with wanting a whole new "quality tourism". It was picked up in Germany in particular, though it was a theme that applied to tourism from all markets: just as the eco-tax did.
The German market did require some later PR massaging in order for it to be satisfied that Alomar and Munar had not been waging some sort of campaign against it. But the fall in tourism (and in German tourism in particular) which occurred needs to be seen against this background, as it also needs to be considered in terms of economic conditions.
While tourism in the Balearics in 2002 fell by 7.6%, the German market showed one of the heaviest falls: down 16%. Indeed, most markets were down that year. The British registered a small 1.2% drop. So, was this the result of the eco-tax?
The German economy went into recession at the end of 2001. Slight growth returned six months later, but weak economic performance was still evident enough by the start of 2003 for "The Economist" to feature an article entitled "Germany's Not Working" on 6 January. There were recessionary influences across Europe in 2002. The UK was an exception. Meanwhile, in Spain as a whole German tourism fell in 2002 by over 6%
The point is that the German market, which had roughly the same one-third share of all Balearic tourism as the UK market in 2001, was by far and away the most important reason why there was a fall in tourism in 2002. The 16% represented over 500,000 tourists. Therefore, was it just the eco-tax which contributed to the decline or did recession and those negative comments from politicians have as much impact if not more?
Moving on to 2003, though Germany was still stumbling economically, the German tourism market revived. As so often is the case (or certainly was before the prolonged "crisis"), confidence picked up relatively quickly. In 2003, and the eco-tax was still applicable until October, tourism in the Balearics grew by 6.6%. The German market was up by over 4%, the British by almost 7%. The losses of 2002 were all but regained.
These "objective data" suggest that in the second year of the eco-tax (2003), tourists - especially German tourists - had either accepted the reality of the tax or had shaken off anxieties caused by recession (a further anxiety, 9/11, has been widely accepted to have not been much of a factor in 2002). The growth in 2003 pushed total tourists numbers above those of 2001, when - and this is usually forgotten - there had also been a fall in tourism: before the eco-tax came in.
This isn't to let the eco-tax off completely. In 2002, for the five main sun and beach regions of Spain, the Balearics was the only one apart from the Canaries to experience a fall in tourism, and this fall - 7.6% - was much higher than the Canaries' 1.8%. Catalonia, meanwhile, had romped along with 15.2% growth.
Was the 2002 crash due to the eco-tax or is it a myth? Not totally. It did play a part, but how great a part is impossible to evaluate. One thing's for sure, it wasn't one million.
Borrego says that there are "objective data" which show that the new tax would create a loss in tourist numbers. These data relate to the previous tax. It, she says, led to there being one million fewer tourists in the Balearics during 2002-2003. Her objective data are open to question.
What losses did the Balearics incur because of the previous tax? Any? It is true to say, because the Balearic tourism ministry keep very complete records of these things, that there was a fall in tourism numbers in the first year that the tax was applied (it came into effect in May 2002). This decline, though sharp, was not as great as Borrego says: it was just over 550,000 for the whole of 2002. Nevertheless, and QED, the eco-tax meant more than half a million fewer tourists. Well, not necessarily.
Borrego has been speaking about the tax and how it is or will be perceived by the German market. The 2015/2016 version of this market will see itself as being under attack by the tax, one which implies a rejection of the visitor. In this, she is echoing the narrative from a separate issue that arose around the time of the old eco-tax. It was one to do with remarks from the then tourism minister, Celesti Alomar, and president of the Council of Mallorca, Maria Antonia Munar. They gave an implication that German tourism of the 2002 variety was not wanted: or at least a certain type of tourism was not wanted. This had little or nothing to do with the eco-tax. It had everything to do with wanting a whole new "quality tourism". It was picked up in Germany in particular, though it was a theme that applied to tourism from all markets: just as the eco-tax did.
The German market did require some later PR massaging in order for it to be satisfied that Alomar and Munar had not been waging some sort of campaign against it. But the fall in tourism (and in German tourism in particular) which occurred needs to be seen against this background, as it also needs to be considered in terms of economic conditions.
While tourism in the Balearics in 2002 fell by 7.6%, the German market showed one of the heaviest falls: down 16%. Indeed, most markets were down that year. The British registered a small 1.2% drop. So, was this the result of the eco-tax?
The German economy went into recession at the end of 2001. Slight growth returned six months later, but weak economic performance was still evident enough by the start of 2003 for "The Economist" to feature an article entitled "Germany's Not Working" on 6 January. There were recessionary influences across Europe in 2002. The UK was an exception. Meanwhile, in Spain as a whole German tourism fell in 2002 by over 6%
The point is that the German market, which had roughly the same one-third share of all Balearic tourism as the UK market in 2001, was by far and away the most important reason why there was a fall in tourism in 2002. The 16% represented over 500,000 tourists. Therefore, was it just the eco-tax which contributed to the decline or did recession and those negative comments from politicians have as much impact if not more?
Moving on to 2003, though Germany was still stumbling economically, the German tourism market revived. As so often is the case (or certainly was before the prolonged "crisis"), confidence picked up relatively quickly. In 2003, and the eco-tax was still applicable until October, tourism in the Balearics grew by 6.6%. The German market was up by over 4%, the British by almost 7%. The losses of 2002 were all but regained.
These "objective data" suggest that in the second year of the eco-tax (2003), tourists - especially German tourists - had either accepted the reality of the tax or had shaken off anxieties caused by recession (a further anxiety, 9/11, has been widely accepted to have not been much of a factor in 2002). The growth in 2003 pushed total tourists numbers above those of 2001, when - and this is usually forgotten - there had also been a fall in tourism: before the eco-tax came in.
This isn't to let the eco-tax off completely. In 2002, for the five main sun and beach regions of Spain, the Balearics was the only one apart from the Canaries to experience a fall in tourism, and this fall - 7.6% - was much higher than the Canaries' 1.8%. Catalonia, meanwhile, had romped along with 15.2% growth.
Was the 2002 crash due to the eco-tax or is it a myth? Not totally. It did play a part, but how great a part is impossible to evaluate. One thing's for sure, it wasn't one million.
Saturday, July 11, 2015
Tourist Tax On Hold?
Those fearful that a tourist tax is about to be suddenly applied need not be too alarmed. This, at least, is the implication of what Balearic vice-president and tourism minister Biel Barceló is saying. He first wants to introduce proper regulation to the non-hotel accommodation sector before such a tax is introduced.
There is a great deal of sense in this. Firstly, such regulation would go some way to ameliorating hoteliers' concerns that it will be they who bear the brunt of a tax: under its previous incarnation, they bore all the brunt. Secondly, if more properties come to be registered, then the regional government will be able to raise greater revenue from the tax. This would mirror the situation in Catalonia, where a more permissive regime in terms of which types of property could be registered as private holiday accommodation was driven at least in part by a desire to maximise revenue.
Essentially, therefore, two of the great controversies of Balearic tourism will coalesce and form one massive controversy. The hoteliers, while they might be reassured of a determination on behalf of Barceló to be as inclusive as possible when it comes to the application of the tax, will not take kindly to a system which may establish a register of holiday accommodation that they have, for years, sought to prevent.
In practical terms, as far as tourist tax implementation is concerned, if it is to be dependent upon the registration factor, then this will now occur some way down the line. Legislation for accommodation regulation will take time, and even greater time will be needed for it to be into effect. Property owners, one would imagine, would be given a reasonable period of grace in order to comply with whatever this legislation might entail, and if it were to also include a quality system - akin to Catalonia's - which identifies the standard of accommodation and its services, then this would add further time.
The heat being generated by both issues has been increasing in line with the temperatures of high summer. Exceltur, a body which represents some pretty exclusive hotelier interests, has been going full frontal with its propaganda against private accommodation. While some of what it and its researchers - Ernst & Young among them - have to say is perfectly legitimate, but the animosity towards alternative accommodation and especially P2P services such as Airbnb doesn't do it total credit, and there is research which takes issue with its apocalyptic (for hoteliers) vision. Still, Exceltur does accept the need for proper regulation and a further need to eliminate the confusion that surrounds private accommodation rental, something that is heightened by the lack of standardised regulation across Spain as a whole.
Exceltur's latest broadside is to report that Palma has the highest level of illegal rental in the country, something exacerbated by the sheer lack of inspectors. In this regard its report is not wrong and it exposes one of the great fault lines in governmental desires (those of the previous government) to get tough. The new government faces exactly the same issue, and whether it is regulation on private accommodation, tougher standards for all-inclusives or whatever, the sheer impossibility - on cost grounds - for there to be an army of inspectors will always render much legislation all but redundant.
Given this, it is more urgent than ever to introduce some pragmatism to legislation. By reducing through more sensible regulation the amount of accommodation deemed to be illegal, then the accommodation which remains genuinely illegal would be easier to monitor: all things being relative.
Barceló will have doubtless taken note of opinions expressed by mayors of some of Mallorca's principal tourism municipalities - Alcúdia, Andratx, Santanyi among them - who advocate new forms of regulation for apartments. He would do well to sit down with these mayors and counsel their views. It is no longer the case that certain towns, e.g. Pollensa, have a disproportionately high amount of private accommodation: P2P and economic crisis have widened the supply across all towns.
Arriving at something like satisfactory regulation will not be straightforward, making a delay to the introduction of a tourist tax potentially even longer. And one hopes that as and when regulation is drawn up it isn't as woolly as the thinking currently being applied to the tourist tax and how it would be collected. Basically, the government doesn't know what sort of mechanism would be best and whether it might have to rely on the agreements of authorities like AENA in order for the tax to be levied on arrival, a mechanism which, for a variety of reasons, would in any event be undesirable.
There is a great deal of sense in this. Firstly, such regulation would go some way to ameliorating hoteliers' concerns that it will be they who bear the brunt of a tax: under its previous incarnation, they bore all the brunt. Secondly, if more properties come to be registered, then the regional government will be able to raise greater revenue from the tax. This would mirror the situation in Catalonia, where a more permissive regime in terms of which types of property could be registered as private holiday accommodation was driven at least in part by a desire to maximise revenue.
Essentially, therefore, two of the great controversies of Balearic tourism will coalesce and form one massive controversy. The hoteliers, while they might be reassured of a determination on behalf of Barceló to be as inclusive as possible when it comes to the application of the tax, will not take kindly to a system which may establish a register of holiday accommodation that they have, for years, sought to prevent.
In practical terms, as far as tourist tax implementation is concerned, if it is to be dependent upon the registration factor, then this will now occur some way down the line. Legislation for accommodation regulation will take time, and even greater time will be needed for it to be into effect. Property owners, one would imagine, would be given a reasonable period of grace in order to comply with whatever this legislation might entail, and if it were to also include a quality system - akin to Catalonia's - which identifies the standard of accommodation and its services, then this would add further time.
The heat being generated by both issues has been increasing in line with the temperatures of high summer. Exceltur, a body which represents some pretty exclusive hotelier interests, has been going full frontal with its propaganda against private accommodation. While some of what it and its researchers - Ernst & Young among them - have to say is perfectly legitimate, but the animosity towards alternative accommodation and especially P2P services such as Airbnb doesn't do it total credit, and there is research which takes issue with its apocalyptic (for hoteliers) vision. Still, Exceltur does accept the need for proper regulation and a further need to eliminate the confusion that surrounds private accommodation rental, something that is heightened by the lack of standardised regulation across Spain as a whole.
Exceltur's latest broadside is to report that Palma has the highest level of illegal rental in the country, something exacerbated by the sheer lack of inspectors. In this regard its report is not wrong and it exposes one of the great fault lines in governmental desires (those of the previous government) to get tough. The new government faces exactly the same issue, and whether it is regulation on private accommodation, tougher standards for all-inclusives or whatever, the sheer impossibility - on cost grounds - for there to be an army of inspectors will always render much legislation all but redundant.
Given this, it is more urgent than ever to introduce some pragmatism to legislation. By reducing through more sensible regulation the amount of accommodation deemed to be illegal, then the accommodation which remains genuinely illegal would be easier to monitor: all things being relative.
Barceló will have doubtless taken note of opinions expressed by mayors of some of Mallorca's principal tourism municipalities - Alcúdia, Andratx, Santanyi among them - who advocate new forms of regulation for apartments. He would do well to sit down with these mayors and counsel their views. It is no longer the case that certain towns, e.g. Pollensa, have a disproportionately high amount of private accommodation: P2P and economic crisis have widened the supply across all towns.
Arriving at something like satisfactory regulation will not be straightforward, making a delay to the introduction of a tourist tax potentially even longer. And one hopes that as and when regulation is drawn up it isn't as woolly as the thinking currently being applied to the tourist tax and how it would be collected. Basically, the government doesn't know what sort of mechanism would be best and whether it might have to rely on the agreements of authorities like AENA in order for the tax to be levied on arrival, a mechanism which, for a variety of reasons, would in any event be undesirable.
Wednesday, July 08, 2015
Armengol: The First One Hundred Days
Certain numbers carry significance for the suspicious and the commemoratively inclined. 111 is English cricket's number of suspicion: its Nelson. 666 is the Devil's number or the number of the beast from Chapter 13 - unlucky for some - of the Book of Revelation. 100 isn't associated with superstition or bad luck, but it has acquired a mythical status in politics. The first 100 days. Why the fascination with 100? For a kick-off, it's a nice round number. It is not 111. It's also reasonably short in temporal terms. 666 would be far too long, even if - with many a governmental administration - its beastliness would offer a more insightful analysis of performance.
Judging when 100 days start is a ritual of its own. In Mallorca, thanks to the procrastinatory nature of installing a new government, it isn't immediately obvious which day is day one, or day zero if you prefer. However, with reasonable certainty, we can take 3, as in 3 July, to be the day of commencement, the day when Francina Armengol held her first cabinet meeting and announced that it was Day Zero for the symbols of Bauzáism: out went the Law of Symbols, trashed was trilingualism (TIL).
On this basis, we can assume that 11 October will commemorate the first 100 days of Armengolism, a useful day as it will be a Sunday and so afford newspapers the opportunity to bulk up their weekend copy with First One Hundred Days specials. It is further useful in that the day after is Spain's National Day, the Day of Hispanidad (Spanishness). Travel agents will be especially happy because of the "puente" weekend, but how happy will others be? How much Spanishness might by then have been dispensed with?
There again, travel agents might have reason to be less than happy. Might the first 100 days witness the arrival of the eco-tax, the 666 devil's work of the horned demon of tourism vice-presidency Biel Barceló? He has said that he will work from the outset for a tourist tax.
Surprisingly, a survey - by the Mallorcan research organisation Gadeso - has found that only a slight majority (51%) of businesses in the tourism sector reject the idea of the tourist tax. Admittedly, only 23% actually agree with it, leaving a further 26% undecided, but one might have anticipated there being greater hostility towards it. Barceló might just be able to take some reassurance from the finding.
It is being said that the tourist tax will be the key legislative item for this government. Possibly it will be, though its passage through parliament shouldn't detain deputies too long, unless PSOE get cold feet, in which case the Més pact (and Podemos support) will collapse rapidly. PSOE's feet will stay warm, especially if Barceló is true to the implication of what he says and seeks to establish at least the legislative framework within the first 100 days. Armengol couldn't afford a falling-out so soon.
What else, apart from the tax, will the specials of Sunday, 11 October be obsessing over? There are already clear signs and not just the abandonment of TIL and the Law of Symbols. One has to do with land, a subject which is vitally important to Mallorca yet which tends to be overlooked in favour of the headline-grabbing of controversies such as the eco-tax. So important is that, even more so than education and language, it is subject to constant political revision which creates the legalistic chaos which surrounds rules on land, on its categorisation and on its use.
Armengol has indicated that another piece of Bauzá legislation - the Ley de Suelo (Land Law) - will be repealed in removing the amnesty that was applied by this law to predominantly rural properties that had been illegally built and which were more than eight years old. The law may, for many, have appeared to have been overly generous, but the fact that so many properties were involved (some 20 odd thousand if I remember rightly) did require some form of pragmatic resolution of their status. Now, the likelihood is that in addition to ever more confusion, the courts will come into their own in arbitrating between two opposing pieces of legislation.
This is an example of Mallorca's politics at its absolute worst. Continuity in legislation is rarely sustained, but when it comes to land, the disruptive legislative tendency causes constant uncertainty. Hence, all the endless cases that do indeed end up in courts. And into this mix comes what may be one of the most important changes during the first 100 days, the confirmation of far greater responsibilities for the Council of Mallorca and so its redefinition of the Mallorca Territorial Plan with all the implications this has for tourism, among other things.
Land law, tourist tax, Catalan linguistic immersion. The first one hundred days will be busy days. Just as well that no one's superstitious.
Judging when 100 days start is a ritual of its own. In Mallorca, thanks to the procrastinatory nature of installing a new government, it isn't immediately obvious which day is day one, or day zero if you prefer. However, with reasonable certainty, we can take 3, as in 3 July, to be the day of commencement, the day when Francina Armengol held her first cabinet meeting and announced that it was Day Zero for the symbols of Bauzáism: out went the Law of Symbols, trashed was trilingualism (TIL).
On this basis, we can assume that 11 October will commemorate the first 100 days of Armengolism, a useful day as it will be a Sunday and so afford newspapers the opportunity to bulk up their weekend copy with First One Hundred Days specials. It is further useful in that the day after is Spain's National Day, the Day of Hispanidad (Spanishness). Travel agents will be especially happy because of the "puente" weekend, but how happy will others be? How much Spanishness might by then have been dispensed with?
There again, travel agents might have reason to be less than happy. Might the first 100 days witness the arrival of the eco-tax, the 666 devil's work of the horned demon of tourism vice-presidency Biel Barceló? He has said that he will work from the outset for a tourist tax.
Surprisingly, a survey - by the Mallorcan research organisation Gadeso - has found that only a slight majority (51%) of businesses in the tourism sector reject the idea of the tourist tax. Admittedly, only 23% actually agree with it, leaving a further 26% undecided, but one might have anticipated there being greater hostility towards it. Barceló might just be able to take some reassurance from the finding.
It is being said that the tourist tax will be the key legislative item for this government. Possibly it will be, though its passage through parliament shouldn't detain deputies too long, unless PSOE get cold feet, in which case the Més pact (and Podemos support) will collapse rapidly. PSOE's feet will stay warm, especially if Barceló is true to the implication of what he says and seeks to establish at least the legislative framework within the first 100 days. Armengol couldn't afford a falling-out so soon.
What else, apart from the tax, will the specials of Sunday, 11 October be obsessing over? There are already clear signs and not just the abandonment of TIL and the Law of Symbols. One has to do with land, a subject which is vitally important to Mallorca yet which tends to be overlooked in favour of the headline-grabbing of controversies such as the eco-tax. So important is that, even more so than education and language, it is subject to constant political revision which creates the legalistic chaos which surrounds rules on land, on its categorisation and on its use.
Armengol has indicated that another piece of Bauzá legislation - the Ley de Suelo (Land Law) - will be repealed in removing the amnesty that was applied by this law to predominantly rural properties that had been illegally built and which were more than eight years old. The law may, for many, have appeared to have been overly generous, but the fact that so many properties were involved (some 20 odd thousand if I remember rightly) did require some form of pragmatic resolution of their status. Now, the likelihood is that in addition to ever more confusion, the courts will come into their own in arbitrating between two opposing pieces of legislation.
This is an example of Mallorca's politics at its absolute worst. Continuity in legislation is rarely sustained, but when it comes to land, the disruptive legislative tendency causes constant uncertainty. Hence, all the endless cases that do indeed end up in courts. And into this mix comes what may be one of the most important changes during the first 100 days, the confirmation of far greater responsibilities for the Council of Mallorca and so its redefinition of the Mallorca Territorial Plan with all the implications this has for tourism, among other things.
Land law, tourist tax, Catalan linguistic immersion. The first one hundred days will be busy days. Just as well that no one's superstitious.
Saturday, May 30, 2015
Elections: Where do they leave tourism?
Pablo Piñero, the president of Grupo Piñero, of which the Bahia Principe hotels and resorts is one part, sounded a warning before the regional election that the Balearics would be in danger if it was not governed by the Partido Popular. He considered that parties such as Podemos lacked people with the necessary abilities for tourism decision-making in government, comparing the alternative parties with the people that the PP has had at its disposal in government: "great professionals" who have benefited everyone and who have created thousands of jobs. He also attacked the idea of there being an eco-tax. Mallorca and Spain had, not so long ago, been on the point of bankruptcy, why would there now be an eco-tax, one that would be a repetition of a previous mistake?
To say that the elections in the Balearics (and everywhere else in Spain) have dominated tourism matters over the past few days would be an understatement. But not everyone appears to be as concerned as Sr. Piñero was prior to voting day. For example, Juan José Hidalgo, the president of Globalia (which includes Air Europa and Be Live hotels), said that he didn't really see a problem, believing that there would be talks and negotiations with newcomers to government to ensure that everything that is best for Spain will be done. Everyone should take a long hard look at tourism and talk, he suggested, and so respect a rule to create wealth and opportunities. He doesn't think that this "simple rule" will change.
Of course, there are those who believe that things will change. Dramatically so. The possibility of there being an eco-tax in the Balearics has become more likely as a consequence of last Sunday's voting. This might well prove to be unpopular with some, but what about proposals regarding private accommodation for holiday rental, all-inclusives and others?
The belief had been that a shift to the left at the election would lead to a coalition government headed by PSOE's Francina Armengol. This may well prove to have been wrong. Within tourism circles, and others, the belief now is that Biel Barceló of the Més socialists-nationalists could well become president of a PSOE-Més-Podemos triumvirate: he would be far more acceptable to Podemos, and as Més and Podemos together command more seats in the new parliament than PSOE, he may well be destined to become president.
The Més tourism programme does, therefore, require looking at. The eco-tax is one element of it. Otherwise, it refers to regulation of all-inclusives and of private accommodation. What this regulation would be precisely is not as yet clear, but the implication is that there would be restrictions introduced on the former and permissiveness introduced for the latter: essentially, therefore, what a lot of people have been calling for. Més is also proposing that there be tax incentives to facilitate a lengthening of the tourism season. Again, there have been many calls for precisely this type of fiscal intervention to encourage hotels and other establishments to remain open in the off-season.
While alarm bells in the tourism sector will have been ringing since Sunday, the Més programme is not especially radical. Clearly there will be concerns that investment might be undermined, but perhaps Sr. Hidalgo's rather relaxed attitude will prove to be more appropriate than Sr. Piñero's anxiety. It is certainly the case that the industry would love there to be a coalition tie-up between the Partido Popular and PSOE (and if Més were so insistent about having its man as president might this even yet happen?), but in the absence of such an alliance, the industry was alert to the proposals from Més and others, which is why discussions were taking place before the election - typified by the hoteliers' federation meeting with all the parties.
Perhaps the greatest uncertainty lies with the somewhat vague references to a "new model" of tourism. Més and Podemos have alluded to a tourism which affords greater benefits to all and not just a limited sector of society, primarily the hoteliers, and it will be with they - the hoteliers - who a left-leaning administration will have its greatest battles. But were there to be restrictions on new hotel building and on all-inclusives as well as a system that permits more tourism commercialisation of private accommodation (and maybe an airline for Mallorca), would these measures prove to be widely unpopular? And, much though the possibility of an eco-tax has been criticised, it might come as a surprise to discover that the principle of such a tax is one that does also have a good deal of support - assuming one believes opinion surveys, that is.
To say that the elections in the Balearics (and everywhere else in Spain) have dominated tourism matters over the past few days would be an understatement. But not everyone appears to be as concerned as Sr. Piñero was prior to voting day. For example, Juan José Hidalgo, the president of Globalia (which includes Air Europa and Be Live hotels), said that he didn't really see a problem, believing that there would be talks and negotiations with newcomers to government to ensure that everything that is best for Spain will be done. Everyone should take a long hard look at tourism and talk, he suggested, and so respect a rule to create wealth and opportunities. He doesn't think that this "simple rule" will change.
Of course, there are those who believe that things will change. Dramatically so. The possibility of there being an eco-tax in the Balearics has become more likely as a consequence of last Sunday's voting. This might well prove to be unpopular with some, but what about proposals regarding private accommodation for holiday rental, all-inclusives and others?
The belief had been that a shift to the left at the election would lead to a coalition government headed by PSOE's Francina Armengol. This may well prove to have been wrong. Within tourism circles, and others, the belief now is that Biel Barceló of the Més socialists-nationalists could well become president of a PSOE-Més-Podemos triumvirate: he would be far more acceptable to Podemos, and as Més and Podemos together command more seats in the new parliament than PSOE, he may well be destined to become president.
The Més tourism programme does, therefore, require looking at. The eco-tax is one element of it. Otherwise, it refers to regulation of all-inclusives and of private accommodation. What this regulation would be precisely is not as yet clear, but the implication is that there would be restrictions introduced on the former and permissiveness introduced for the latter: essentially, therefore, what a lot of people have been calling for. Més is also proposing that there be tax incentives to facilitate a lengthening of the tourism season. Again, there have been many calls for precisely this type of fiscal intervention to encourage hotels and other establishments to remain open in the off-season.
While alarm bells in the tourism sector will have been ringing since Sunday, the Més programme is not especially radical. Clearly there will be concerns that investment might be undermined, but perhaps Sr. Hidalgo's rather relaxed attitude will prove to be more appropriate than Sr. Piñero's anxiety. It is certainly the case that the industry would love there to be a coalition tie-up between the Partido Popular and PSOE (and if Més were so insistent about having its man as president might this even yet happen?), but in the absence of such an alliance, the industry was alert to the proposals from Més and others, which is why discussions were taking place before the election - typified by the hoteliers' federation meeting with all the parties.
Perhaps the greatest uncertainty lies with the somewhat vague references to a "new model" of tourism. Més and Podemos have alluded to a tourism which affords greater benefits to all and not just a limited sector of society, primarily the hoteliers, and it will be with they - the hoteliers - who a left-leaning administration will have its greatest battles. But were there to be restrictions on new hotel building and on all-inclusives as well as a system that permits more tourism commercialisation of private accommodation (and maybe an airline for Mallorca), would these measures prove to be widely unpopular? And, much though the possibility of an eco-tax has been criticised, it might come as a surprise to discover that the principle of such a tax is one that does also have a good deal of support - assuming one believes opinion surveys, that is.
Friday, April 10, 2015
"Record" Easter, Elections And Eco-tax
Easter joy. Mallorca enjoyed the best Easter of the last decade. Hotel occupancy was at 76% with 80% of hotels open. In some parts of the island the occupancy was into the eighty-percentage bracket or even 90% (Camp de Mar). Joy indeed, but are we convinced? An analysis I made of Alcúdia revealed that the percentage of hotels open was not of the order that was being boasted; it was more like 50%. Alcúdia is only one resort, but if it is indicative, then where were the 80%?
Forgive my scepticism, but do I detect the proximity of elections and the support of the hoteliers' federation for the regional government? Good news on the tourism front can act as a boost to the Bauzá administration not just because of tourist numbers but also because of more employment, something that the federation has also been at pains to point to. This good news should say to the electorate that "tourism is working" under the PP and thus quell any talk of policies which might interrupt this, e.g. the revival of a tourist tax, and fire a pre-electoral broadside against parties that might undo this work.
If the good news is genuinely to be believed, it is the consequence principally of a revival in the domestic market, by which one means both Spanish mainland and Mallorcan: there were, for example, hotels in the north with Easter-breakers from the south. It is also a consequence, perhaps to a lesser degree, of instability elsewhere, notably Tunisia. Both these factors will come to Mallorca's aid this summer, but neither is proof that "tourism is working" under the PP per se.
This said, a change to the political landscape does introduce an element of uncertainty to the island's tourism. With the elections moving ever closer, issues such as a tourist tax are moving higher up the debating agenda. Som Palma, which is the city's version of Podemos, is speaking of introducing a specific tourist tax for Palma, the "same as exists in other European cities", while at a forum during the week, tourism minister Jaime Martínez and the hoteliers' president, Aurelio Vázquez, clashed with David Abril of Més over the potential for a tax. Martínez said that now was the time to be lowering taxes not creating new ones. Vázquez alluded to the disaster that was the old eco-tax. Abril insisted that a tax would be about "sharing prosperity" and recovering the future (whatever this means).
Francina Armengol for PSOE - and she may well become the next president of the Balearics - spoke earlier in the week about a tourist tax, saying that it might have to be looked at if financing from the state for the Balearics was not improved. Linking the possible introduction of a tax to the issue of financing was an attack on the regional government's perceived failure to negotiate an improved financing arrangement with Madrid, but doubts remain as to how committed PSOE might be to such a tax. Despite one of its spokespeople, Cosme Bonet, having talked up a tourist tax, the party has not forgotten the eco-tax disaster that Vázquez was quick to remind everyone of at the forum. It was a tax that a PSOE-led government introduced.
Nevertheless, battle is well and truly being joined, and tourism, especially in the form of a tourist tax, is going to be one of the key issues of the forthcoming elections.
Forgive my scepticism, but do I detect the proximity of elections and the support of the hoteliers' federation for the regional government? Good news on the tourism front can act as a boost to the Bauzá administration not just because of tourist numbers but also because of more employment, something that the federation has also been at pains to point to. This good news should say to the electorate that "tourism is working" under the PP and thus quell any talk of policies which might interrupt this, e.g. the revival of a tourist tax, and fire a pre-electoral broadside against parties that might undo this work.
If the good news is genuinely to be believed, it is the consequence principally of a revival in the domestic market, by which one means both Spanish mainland and Mallorcan: there were, for example, hotels in the north with Easter-breakers from the south. It is also a consequence, perhaps to a lesser degree, of instability elsewhere, notably Tunisia. Both these factors will come to Mallorca's aid this summer, but neither is proof that "tourism is working" under the PP per se.
This said, a change to the political landscape does introduce an element of uncertainty to the island's tourism. With the elections moving ever closer, issues such as a tourist tax are moving higher up the debating agenda. Som Palma, which is the city's version of Podemos, is speaking of introducing a specific tourist tax for Palma, the "same as exists in other European cities", while at a forum during the week, tourism minister Jaime Martínez and the hoteliers' president, Aurelio Vázquez, clashed with David Abril of Més over the potential for a tax. Martínez said that now was the time to be lowering taxes not creating new ones. Vázquez alluded to the disaster that was the old eco-tax. Abril insisted that a tax would be about "sharing prosperity" and recovering the future (whatever this means).
Francina Armengol for PSOE - and she may well become the next president of the Balearics - spoke earlier in the week about a tourist tax, saying that it might have to be looked at if financing from the state for the Balearics was not improved. Linking the possible introduction of a tax to the issue of financing was an attack on the regional government's perceived failure to negotiate an improved financing arrangement with Madrid, but doubts remain as to how committed PSOE might be to such a tax. Despite one of its spokespeople, Cosme Bonet, having talked up a tourist tax, the party has not forgotten the eco-tax disaster that Vázquez was quick to remind everyone of at the forum. It was a tax that a PSOE-led government introduced.
Nevertheless, battle is well and truly being joined, and tourism, especially in the form of a tourist tax, is going to be one of the key issues of the forthcoming elections.
Friday, February 27, 2015
The Battles For Mallorca's Tourism
Pre-election skirmishes they may be, but battle lines are nevertheless being drawn in the velvety white sands of Mallorca's tourism. Following the revelation (one that was not in the least bit surprising) of the eco-tax being revived by a pact of parties on the left, the Mallorca Hotel Party (aka Federation) and its presidential candidate, Inma de Benito, came out all guns blazing, seeking to shoot down eco-tax revivalism before it has any chance of being truly re-born. There was as little surprise at the hoteliers' objections as there had been at the left's rediscovered love affair with the tax. Meanwhile, Tourism Public Enemy Number One, the secretary-general of Podemos in the Balearics, Alberto Jarabo, had raised hackles sufficiently well for Calvia's Partido Popular to go into full anti-Podemos mode. At the council meeting, Jarabo's "threats" to the hotels were being condemned by PP-ites, desperately worried that they might be out of jobs come May.
Jarabo had of course riled some within the ranks of Podemos itself, and reactions like those of the Calvia PP might be said to give too much prominence to someone whose grasp on tourism may not be all that it seems. When Jarabo was justifying the return of the eco-tax, he referred to its implementation in Catalonia and Madrid. He was right on Catalonia but he was wrong about Madrid (and this, despite the fact that he comes from Madrid). There is no tourist tax in Madrid. Still, we have become used to Majorcan politicians having only limited knowledge of tourism matters. Bauzá once suggested that the Baltic countries were competitors to Mallorca's summer tourism. Prior to this assertion, no one else had ever made such a claim, and they certainly haven't done so since.
Someone who does have intimate understanding of Mallorca's tourism is Calvia town hall veteran Jaime Martínez. The larger than your average tourism minister bear has such deep knowledge that it is produced in a 50-page document replete with many-coloured graphs and pie charts, statistics and percentages. The "balance" of Balearics tourism in 2014 was presented for us all to see, and we could only but admire a ministerial ability to use presentation software. Before publishing this consultants' dream of a document, Jaime had been telling us how positive January's tourism had been. He stopped short of describing it as "historic" (one of his favoured adjectives) but a 21% increase in January's international tourism was cause for celebration and for confirming that the ministry's paltry promotional spend on travel fairs and blogger trips was paying off. However, when one considered the numbers for all of January's tourism, it became apparent that half of it was made up Spanish pensionistas, whose spend is just a fraction above zero, while state-subsidised pensioners from countries like Denmark were also in the mix (and they spend only a fraction more than their Spanish counterparts) as were - because tourist arrival statistics do not discriminate - all the various cycling teams, such as Sky and their entourages.
Jarabo had of course riled some within the ranks of Podemos itself, and reactions like those of the Calvia PP might be said to give too much prominence to someone whose grasp on tourism may not be all that it seems. When Jarabo was justifying the return of the eco-tax, he referred to its implementation in Catalonia and Madrid. He was right on Catalonia but he was wrong about Madrid (and this, despite the fact that he comes from Madrid). There is no tourist tax in Madrid. Still, we have become used to Majorcan politicians having only limited knowledge of tourism matters. Bauzá once suggested that the Baltic countries were competitors to Mallorca's summer tourism. Prior to this assertion, no one else had ever made such a claim, and they certainly haven't done so since.
Someone who does have intimate understanding of Mallorca's tourism is Calvia town hall veteran Jaime Martínez. The larger than your average tourism minister bear has such deep knowledge that it is produced in a 50-page document replete with many-coloured graphs and pie charts, statistics and percentages. The "balance" of Balearics tourism in 2014 was presented for us all to see, and we could only but admire a ministerial ability to use presentation software. Before publishing this consultants' dream of a document, Jaime had been telling us how positive January's tourism had been. He stopped short of describing it as "historic" (one of his favoured adjectives) but a 21% increase in January's international tourism was cause for celebration and for confirming that the ministry's paltry promotional spend on travel fairs and blogger trips was paying off. However, when one considered the numbers for all of January's tourism, it became apparent that half of it was made up Spanish pensionistas, whose spend is just a fraction above zero, while state-subsidised pensioners from countries like Denmark were also in the mix (and they spend only a fraction more than their Spanish counterparts) as were - because tourist arrival statistics do not discriminate - all the various cycling teams, such as Sky and their entourages.
Wednesday, February 25, 2015
It's Back: The eco-tax
So, it's pretty much official. It has yet to be ratified, but a Balearics eco-tax, or a tax on tourists under some other name, will in all likelihood feature in the manifestos of Podemos, Més and PSOE. If, as seems possible, these three parties form a coalition government, an eco-tax it almost certainly will be.
It comes as no surprise that Podemos and Més should favour such a tax. PSOE is more of a surprise. I had previously doubted that PSOE would wish to revisit the crash scene of a tax it was responsible for introducing during its first administration (the pact of 1999-2003). The PSOE hierarchy might, when push comes to manifesto shove, take the view that it is too emotive an issue and too much of a risk, but Cosme Bonet, one of the party's electoral programme co-ordinators, appears to believe it is a risk worth taking in order that "tourism contributes to the conservation of the environment". He prefers to not refer to the tax as an eco one, but eco-tax is precisely what it would be.
Bonet has also said that it would be a tax with the consensus of the tourism sector. If he believes there will be consensus, he is probably deluding himself. The hoteliers, for one, will take a great deal of persuading. It was, after all, they who got the Matas Partido Popular administration from 2003 to abandon PSOE's unpopular tax. There again, the hoteliers had every reason to have been indignant with the old tax. It was they who shouldered the burden for its collection. One of the flaws of the eco-tax was that it was discriminatory; it was not applied to non-hotel accommodation.
This time, as far as the Més spokesperson David Abril is concerned, the hoteliers will not be singled out. The tax would be universal, and by that he means the inclusion of private holiday accommodation, currently not regulated, that Més would regulate. As PSOE has previously suggested that it would also seek regulation and as Podemos has intimated as much, a tax would apply more widely, just as it does in Catalonia, where private accommodation is properly registered and regulated. But this will hardly be a move to mollify the hoteliers or guarantee a consensus.
Tourist taxes are the flavour of the moment and not only among the Balearics left. In the Canaries, the Nueva Canarias party has presented a proposal for a tax to the regional parliament. Its purpose would be to raise additional funds for modernising outdated resorts and tourist services. The party reckons that 100 million euros could be raised. The hoteliers in the Canaries are dead against the idea. Among reasons for their objections is the Balearics eco-tax fiasco. Others include arguments that the sector is over-taxed as it is and that far too little of the revenue raised by the Canaries' tourism sector actually finds its way back into the system. This is a reasonable argument. The tourism sector generates tax revenues of over 1,500 million euros annually, yet, as an example, only 17 million are earmarked for tourism promotion (which is still a lot more than in the Balearics). It is an argument which, not for the first time, raises questions as to how tax revenues raised by the regions are then redistributed and used.
In Madrid, the PSM (Madrid socialist party) wants to introduce a tourist tax, one that has been spoken about for years but regularly rejected. The difference here though is that it would be a tax for a city, and there are plenty of examples of European cities which have such a tax. The Canaries' objections refer to the fact that tourist taxes are applied to cities and not tourist regions, but they then run up against one very important exception. Catalonia. Its tax is for the whole region and so includes tourist areas such as the Costa Brava as well as Barcelona.
Catalonia's experience of a tourist tax was always going to be one closely observed by other regions of Spain; it hasn't had any harmful impact. It is a tax that isn't too onerous (ninety cents a night is a typical rate) and that is limited in terms of the number of overnight stays: for a two-week holiday, for instance, it only applies to a maximum of seven nights. But Catalonia is not Mallorca and nor is it Tenerife. It clearly has hugely popular mass-tourism areas, but these don't generate quite the same media interest that Mallorca does. The old eco-tax was as much a PR disaster because of negative international media coverage as it was a disaster of discriminatory implementation. Any new tax would come in for the same treatment; the same hue and cry. Would it, therefore, be too great a risk?
It comes as no surprise that Podemos and Més should favour such a tax. PSOE is more of a surprise. I had previously doubted that PSOE would wish to revisit the crash scene of a tax it was responsible for introducing during its first administration (the pact of 1999-2003). The PSOE hierarchy might, when push comes to manifesto shove, take the view that it is too emotive an issue and too much of a risk, but Cosme Bonet, one of the party's electoral programme co-ordinators, appears to believe it is a risk worth taking in order that "tourism contributes to the conservation of the environment". He prefers to not refer to the tax as an eco one, but eco-tax is precisely what it would be.
Bonet has also said that it would be a tax with the consensus of the tourism sector. If he believes there will be consensus, he is probably deluding himself. The hoteliers, for one, will take a great deal of persuading. It was, after all, they who got the Matas Partido Popular administration from 2003 to abandon PSOE's unpopular tax. There again, the hoteliers had every reason to have been indignant with the old tax. It was they who shouldered the burden for its collection. One of the flaws of the eco-tax was that it was discriminatory; it was not applied to non-hotel accommodation.
This time, as far as the Més spokesperson David Abril is concerned, the hoteliers will not be singled out. The tax would be universal, and by that he means the inclusion of private holiday accommodation, currently not regulated, that Més would regulate. As PSOE has previously suggested that it would also seek regulation and as Podemos has intimated as much, a tax would apply more widely, just as it does in Catalonia, where private accommodation is properly registered and regulated. But this will hardly be a move to mollify the hoteliers or guarantee a consensus.
Tourist taxes are the flavour of the moment and not only among the Balearics left. In the Canaries, the Nueva Canarias party has presented a proposal for a tax to the regional parliament. Its purpose would be to raise additional funds for modernising outdated resorts and tourist services. The party reckons that 100 million euros could be raised. The hoteliers in the Canaries are dead against the idea. Among reasons for their objections is the Balearics eco-tax fiasco. Others include arguments that the sector is over-taxed as it is and that far too little of the revenue raised by the Canaries' tourism sector actually finds its way back into the system. This is a reasonable argument. The tourism sector generates tax revenues of over 1,500 million euros annually, yet, as an example, only 17 million are earmarked for tourism promotion (which is still a lot more than in the Balearics). It is an argument which, not for the first time, raises questions as to how tax revenues raised by the regions are then redistributed and used.
In Madrid, the PSM (Madrid socialist party) wants to introduce a tourist tax, one that has been spoken about for years but regularly rejected. The difference here though is that it would be a tax for a city, and there are plenty of examples of European cities which have such a tax. The Canaries' objections refer to the fact that tourist taxes are applied to cities and not tourist regions, but they then run up against one very important exception. Catalonia. Its tax is for the whole region and so includes tourist areas such as the Costa Brava as well as Barcelona.
Catalonia's experience of a tourist tax was always going to be one closely observed by other regions of Spain; it hasn't had any harmful impact. It is a tax that isn't too onerous (ninety cents a night is a typical rate) and that is limited in terms of the number of overnight stays: for a two-week holiday, for instance, it only applies to a maximum of seven nights. But Catalonia is not Mallorca and nor is it Tenerife. It clearly has hugely popular mass-tourism areas, but these don't generate quite the same media interest that Mallorca does. The old eco-tax was as much a PR disaster because of negative international media coverage as it was a disaster of discriminatory implementation. Any new tax would come in for the same treatment; the same hue and cry. Would it, therefore, be too great a risk?
Wednesday, July 09, 2014
Mallorca's Greatest Scandals And PR Disasters
Here are just a few scandals and potential or real PR disasters that Mallorca has had to face over the past twenty years or so. One of them doesn't really belong here. Which one? You decide.
1. The Sóller Tunnel. The first great corruption scandal of modern, autonomous-government Mallorca. In 1989, the Balearic Government granted the concession for the building of the tunnel to a company owned by Antoni Cuart, a friend of the then president of the Balearics, Gabriel Cañellas. In that year, money started to be lodged in bank accounts. It came from Cuart, though he was to state in court that it was a company director, by then dead, who was responsible for administering payments. The money was used for Partido Popular electoral purposes and was channelled to the Balearic Islands Foundation, presided over by Cañellas, who was forced to resign as president. He was indicted, but the affair came to an end when the Balearics High Court closed the case in 1997. The charges were proven but those accused were acquitted because of the statute of limitations.
2. The eco-tax. Dreamt up by PSOE's Celesti Alomar, the tourism minister, and the minister for finance, Joan Mesquida, the eco-tax, officially and legally named the "tax for stays in businesses for tourist accommodation", was approved in 2001 and introduced from 1 May, 2002. The battle to prevent the tax's introduction saw the national Partido Popular government against it and the national constitutional court having to arbitrate. It decided against suspension of the tax, and so it came into being. At the time of its introduction, there was a slump in the German tourism market and, though it has been argued that the tax didn't contribute to a further slump, there were plenty who argued that it did. The PR fallout was felt in Britain, too, and when the PP came back to power in the Balearics in 2003, it scrapped the tax.
3. Jaume Matas and all that. Where does one begin with the corruption charges levelled against the former Balearics president? They all stemmed from what was known as the "caso Andratx", a series of charges brought against, among others, the former PP mayor of Andratx, Eugenio Hidalgo, in 2006. They all had to do with urban planning corruption. Hidalgo went to prison, but in the process of investigation, anti-corruption prosecutors and investigating judges began digging much deeper. One of the others who went to prison was the director-general for land planning in the Matas 2003-2007 government. The link was established. What followed were numerous separate investigations. These implicated not just members of the PP but also leading figures in the Unió Mallorquina, the PP's partner in government. These leading figures are all now in prison. Matas isn't, but he faces many charges which have yet to come to trial. And the most significant of the cases is one known as the "caso Palma Arena". It was this investigation which led to something even more scandalous.
4. Iñaki Urdangarin. He was just another member of the Spanish royal family, the husband of Princess Cristina, King Juan Carlos's younger daughter. He had been an Olympic sportsman and through marriage to Cristina, the Duchess of Palma, he became the Duke of Palma. He wasn't an obscure royal but he wasn't important either. He became very important, however, when Judge José Castro, investigating the "caso Palma Arena", unearthed some invoices which had been raised by the Instituto Noos, of which Urdangarin had been a co-founder, and sent to the Fundación Illesport, a body linked to the tourism ministry. They were for 2.3 million euros, and the final invoice was raised just before the 2007 election that Matas lost. The judge was interested in these invoices. Very interested. And he became interested as well in the role of the princess. The Mallorcan scandal became a Spanish scandal. Juan Carlos was embroiled in the scandal, and who is to say that the possibility of his daughter being placed on trial didn't contribute to his abdication?
5. The Palmanova bombing. Five years ago (the date was 30 July), two Guardia Civil officers were blown up by an ETA bomb that had been hidden on their patrol vehicle. It was Mallorca's first true atrocity by terrorists. The island went into lockdown but the terrorists were not found. The press, the British press in the form of "The Sun", did its best to turn the bombing and two subsequent minor incidents in Palma into a PR disaster. Its travel editor wrote that the bombs could spell the end of tourism in Spain and that tourists would avoid Mallorca. She was very wrong.
6. In a bar in Magalluf in 2014, an Irish girl was filmed while engaging in some action with over twenty todgers. The video went viral on the internet. No one died.
1. The Sóller Tunnel. The first great corruption scandal of modern, autonomous-government Mallorca. In 1989, the Balearic Government granted the concession for the building of the tunnel to a company owned by Antoni Cuart, a friend of the then president of the Balearics, Gabriel Cañellas. In that year, money started to be lodged in bank accounts. It came from Cuart, though he was to state in court that it was a company director, by then dead, who was responsible for administering payments. The money was used for Partido Popular electoral purposes and was channelled to the Balearic Islands Foundation, presided over by Cañellas, who was forced to resign as president. He was indicted, but the affair came to an end when the Balearics High Court closed the case in 1997. The charges were proven but those accused were acquitted because of the statute of limitations.
2. The eco-tax. Dreamt up by PSOE's Celesti Alomar, the tourism minister, and the minister for finance, Joan Mesquida, the eco-tax, officially and legally named the "tax for stays in businesses for tourist accommodation", was approved in 2001 and introduced from 1 May, 2002. The battle to prevent the tax's introduction saw the national Partido Popular government against it and the national constitutional court having to arbitrate. It decided against suspension of the tax, and so it came into being. At the time of its introduction, there was a slump in the German tourism market and, though it has been argued that the tax didn't contribute to a further slump, there were plenty who argued that it did. The PR fallout was felt in Britain, too, and when the PP came back to power in the Balearics in 2003, it scrapped the tax.
3. Jaume Matas and all that. Where does one begin with the corruption charges levelled against the former Balearics president? They all stemmed from what was known as the "caso Andratx", a series of charges brought against, among others, the former PP mayor of Andratx, Eugenio Hidalgo, in 2006. They all had to do with urban planning corruption. Hidalgo went to prison, but in the process of investigation, anti-corruption prosecutors and investigating judges began digging much deeper. One of the others who went to prison was the director-general for land planning in the Matas 2003-2007 government. The link was established. What followed were numerous separate investigations. These implicated not just members of the PP but also leading figures in the Unió Mallorquina, the PP's partner in government. These leading figures are all now in prison. Matas isn't, but he faces many charges which have yet to come to trial. And the most significant of the cases is one known as the "caso Palma Arena". It was this investigation which led to something even more scandalous.
4. Iñaki Urdangarin. He was just another member of the Spanish royal family, the husband of Princess Cristina, King Juan Carlos's younger daughter. He had been an Olympic sportsman and through marriage to Cristina, the Duchess of Palma, he became the Duke of Palma. He wasn't an obscure royal but he wasn't important either. He became very important, however, when Judge José Castro, investigating the "caso Palma Arena", unearthed some invoices which had been raised by the Instituto Noos, of which Urdangarin had been a co-founder, and sent to the Fundación Illesport, a body linked to the tourism ministry. They were for 2.3 million euros, and the final invoice was raised just before the 2007 election that Matas lost. The judge was interested in these invoices. Very interested. And he became interested as well in the role of the princess. The Mallorcan scandal became a Spanish scandal. Juan Carlos was embroiled in the scandal, and who is to say that the possibility of his daughter being placed on trial didn't contribute to his abdication?
5. The Palmanova bombing. Five years ago (the date was 30 July), two Guardia Civil officers were blown up by an ETA bomb that had been hidden on their patrol vehicle. It was Mallorca's first true atrocity by terrorists. The island went into lockdown but the terrorists were not found. The press, the British press in the form of "The Sun", did its best to turn the bombing and two subsequent minor incidents in Palma into a PR disaster. Its travel editor wrote that the bombs could spell the end of tourism in Spain and that tourists would avoid Mallorca. She was very wrong.
6. In a bar in Magalluf in 2014, an Irish girl was filmed while engaging in some action with over twenty todgers. The video went viral on the internet. No one died.
Tuesday, May 06, 2014
The Return Of The Eco-Tax?
PSOE, aka PSIB in the Balearics, certainly knows what the big issues in tourism are. When the national tenancy act was reformed last year, there was PSOE siding with the supporters of private apartments for holiday let. This was a case of politicking by a party which had done nothing to alter legislation in the Balearics whilst it had been in power.
Yet more politicking has been in evidence in Calvia. PSOE's call for all-inclusive regulation is an act of self-interested irrelevance, as there isn't a cat in hell's chance of there ever being anything which equates to a ban anywhere in the Balearics. Talk of a ban is a nonsense because of European law.
And now, there is more politicking. The third big issue that PSOE is raising is one which, were it to win the next election, it could do something about. The eco-tax has returned, and the hoteliers will already be sharpening their knives. PSOE's proposal to the Balearic parliament for the eco-tax to be reintroduced is destined to fail while the Partido Popular remains in government, but having brought it before parliament while in opposition, might it do so in government? A coalition that places the Més leftist grouping in alliance with PSOE (and others) could well bring the tax back.
The PP government has consistently said that it has no intention of reviving the eco-tax. It made its views perfectly clear to the APTUR holiday-lets association when it proposed the tax and the revenue benefits it would realise, were there to be permissive regulation of private holiday apartments.
Why is PSOE once more raising the spectre of the eco-tax? Its deputy, Antoni Diéguez, who is the one who has brought the matter up, says, among other things, that it would help to reactivate the economy by facilitating public investment. Really?
It should be recalled that the eco-tax was introduced by the first Antich PSOE-led administration. It was a botched job, poorly implemented and poorly explained. What revenue it raised contributed little. A good chunk of it went on acquiring the Son Real finca, an investment that was perhaps justifiable given the finca's heritage, but one that was never destined to mean anything in terms of economic return or benefit.
PSOE will be able to point to the example of Catalonia in arguing that a tourist tax (which is what the eco-tax is) does not harm tourism and does raise revenue. It is true to say that since the tourist tax was implemented, Catalonia's tourism appears not to have been harmed. It also true to say that the Catalonian government has a very healthy tourism promotion budget, thanks to the tax. It is in excess of 30 million euros, more than ten times the size of the Balearics tourism promotion budget.
But the Catalans were clear from the outset that the tax would be earmarked for promotion. They are, in effect, getting tourists to pay for trying to attract more tourists. While Catalonian tourism has not been harmed by the tax, the moral basis for it is dubious.
An eco-tax, on the other hand, does have a moral basis. Tax revenues are of course raised through tourism activities, and these revenues contribute to provision of services and resources. But tourism does not pay directly for these services or resources. Moreover, the system of financing for the Balearics means that the islands make a net loss on tax revenues that are raised, and a pretty hefty loss at that: Madrid returns way less than it receives from the Balearics.
As a consequence, there is a fiscal gap in the Balearics, but seeing the issue purely in fiscal terms neglects the costs, in all manner of ways, that are associated with tourism. It, tourism, uses the same water, same electricity, same roads, same sewage, same health service, same police as everyone else. Yet it is transient and it doesn't pay directly. Indeed, what it pays is declining, the result of all-inclusives. A growing amount of tourism leeches off land, resources and utilities and gives precious little back.
Opponents of the eco-tax will point to the "crisis" that affected Balearics tourism between 2001 and 2003. There was a slump, but the eco-tax was by no means the only cause. Indeed, it has been argued that in itself it didn't have any discernible impact. The German economy at the time, 9/11, the euro, PSOE's attitudes when in government have all been cited as other factors. But the tax was badly implemented.
PSOE would know that the current government would reject its proposal, but it is a proposal which may have more of an eye on the future than on the present. If it does, then PSOE is heading for a battle royal with the unofficial government - the hoteliers.
Yet more politicking has been in evidence in Calvia. PSOE's call for all-inclusive regulation is an act of self-interested irrelevance, as there isn't a cat in hell's chance of there ever being anything which equates to a ban anywhere in the Balearics. Talk of a ban is a nonsense because of European law.
And now, there is more politicking. The third big issue that PSOE is raising is one which, were it to win the next election, it could do something about. The eco-tax has returned, and the hoteliers will already be sharpening their knives. PSOE's proposal to the Balearic parliament for the eco-tax to be reintroduced is destined to fail while the Partido Popular remains in government, but having brought it before parliament while in opposition, might it do so in government? A coalition that places the Més leftist grouping in alliance with PSOE (and others) could well bring the tax back.
The PP government has consistently said that it has no intention of reviving the eco-tax. It made its views perfectly clear to the APTUR holiday-lets association when it proposed the tax and the revenue benefits it would realise, were there to be permissive regulation of private holiday apartments.
Why is PSOE once more raising the spectre of the eco-tax? Its deputy, Antoni Diéguez, who is the one who has brought the matter up, says, among other things, that it would help to reactivate the economy by facilitating public investment. Really?
It should be recalled that the eco-tax was introduced by the first Antich PSOE-led administration. It was a botched job, poorly implemented and poorly explained. What revenue it raised contributed little. A good chunk of it went on acquiring the Son Real finca, an investment that was perhaps justifiable given the finca's heritage, but one that was never destined to mean anything in terms of economic return or benefit.
PSOE will be able to point to the example of Catalonia in arguing that a tourist tax (which is what the eco-tax is) does not harm tourism and does raise revenue. It is true to say that since the tourist tax was implemented, Catalonia's tourism appears not to have been harmed. It also true to say that the Catalonian government has a very healthy tourism promotion budget, thanks to the tax. It is in excess of 30 million euros, more than ten times the size of the Balearics tourism promotion budget.
But the Catalans were clear from the outset that the tax would be earmarked for promotion. They are, in effect, getting tourists to pay for trying to attract more tourists. While Catalonian tourism has not been harmed by the tax, the moral basis for it is dubious.
An eco-tax, on the other hand, does have a moral basis. Tax revenues are of course raised through tourism activities, and these revenues contribute to provision of services and resources. But tourism does not pay directly for these services or resources. Moreover, the system of financing for the Balearics means that the islands make a net loss on tax revenues that are raised, and a pretty hefty loss at that: Madrid returns way less than it receives from the Balearics.
As a consequence, there is a fiscal gap in the Balearics, but seeing the issue purely in fiscal terms neglects the costs, in all manner of ways, that are associated with tourism. It, tourism, uses the same water, same electricity, same roads, same sewage, same health service, same police as everyone else. Yet it is transient and it doesn't pay directly. Indeed, what it pays is declining, the result of all-inclusives. A growing amount of tourism leeches off land, resources and utilities and gives precious little back.
Opponents of the eco-tax will point to the "crisis" that affected Balearics tourism between 2001 and 2003. There was a slump, but the eco-tax was by no means the only cause. Indeed, it has been argued that in itself it didn't have any discernible impact. The German economy at the time, 9/11, the euro, PSOE's attitudes when in government have all been cited as other factors. But the tax was badly implemented.
PSOE would know that the current government would reject its proposal, but it is a proposal which may have more of an eye on the future than on the present. If it does, then PSOE is heading for a battle royal with the unofficial government - the hoteliers.
Monday, April 28, 2014
The Political Reason For All-Inclusive
"All-inclusive is a desperate effort by tour operators to maintain their operational capacity in our country. It is a short-term strategy while they resize their strategy and prepare new products ... All-inclusive is not the future for our country."
These were the words of Celestí Alomar, who was Balearics tourism minister during the first PSOE-led government from 1999 to 2003. He wrote them the year after PSOE had lost the 2003 election. It is clear that Alomar felt that the all-inclusive would die out and that it had been a response to what had been a trend away from the traditional package holiday. It is also clear that he was wrong and that there were further errors in his analysis. He spoke of the Spanish hotel industry having been, up till that point, reluctant to embrace all-inclusive and that, in 2004, it was something of a novelty.
He may have been right to point to novelty where Spanish tourism in total was concerned, but where the Balearics were concerned, he had seemingly forgotten what he had said in 2001. Two years into his position as minister, he gave an interview to the German magazine "Focus". In this he referred to the eight million tourists who came to Mallorca each year, roughly a half of them German, and to the all-inclusive offers that German tourists were taking up.
That interview caused a considerable stir, not because of the reference to all-inclusive but because Alomar was signalling the intention to radically reduce "mass tourism". Together with colleagues in the former Unió Mallorquina, policy was drawn up which sent out a message that Mallorca and the Balearics were no longer interested in the regular German tourist. It provoked a great deal of anger. When the eco-tax was then introduced (Alomar was partly responsible for it), the German market slumped. It was taking its revenge for both the insult implicit to the message of the interview and for the tax (though it should also be pointed out that the German economy was in its own slump at that time).
It is true to say that the traditional package holiday was under threat. It is also true to say that all-inclusive was a response to this threat. But when, in 2004, Alomar spoke of "irreparable damage" that all-inclusive could cause, he neglected the damage that he, Joan Mesquida (finance minister in the PSOE government) and Maria Antonia Munar (with her infamous utterances about Mallorca only wanting "quality" tourists) had sought to inflict.
Though one can't talk of there having been a co-ordinated counterattack, tour operators and hoteliers went on the counterattack. They responded to governmental policy and messages and to the eco-tax with what was a weapon of last resort - the all-inclusive.
In 2005, two years into the Partido Popular administration of Jaume Matas, the then tourism minister, Joan Flaquer, attributed the increase in all-inclusive to the "weakness" of the Balearics as a holiday destination. Flaquer was alluding to something of a "crisis" in the local tourism industry, detectable from 2002. He stated that his government and its policies were not the reason for the rise in all-inclusive. He was placing the blame firmly on the previous administration.
Alomar's "novelty" factor was plainly wrong in the Balearics context. In 1998, the year before he became PSOE's minister, it was reckoned that there were twenty hotels in the Balearics which offered all-inclusive. By 2003, when PSOE lost the election, there were 129. In fact, this rise was almost totally observable in 2003.
Business strategies quite separate to any political issues in the Balearics have to be taken account of, but is it an exaggeration to suggest that there was an all-inclusive-led counterattack? Is it inappropriate to talk of there having been a direct link between attitudes and policies of the PSOE administration and its Unió Mallorquina allies and the massive increase in the all-inclusive offer?
Flaquer tried, in both 2005 and 2006, to allay fears regarding all-inclusive. In 2005, he stated that the number of establishments offering it was plateauing. He was to be proved wrong. The following year, he spoke about a campaign involving the tourism and health ministries which was part of a set of measures to regulate all-inclusive. There was to be specific quality certification; there were to also be intensive inspections of hotels. Regulation was not proscription (it couldn't have been without a massive legal backlash), but the limited regulation that was supposedly introduced proved to be toothless.
Because of strategic product changes by tour operators, it can be too convenient to attach political blame for the explosion in all-inclusive. But when PSOE in Calvia, in a barely disguised, self-serving, pre-election move, now demand action against all-inclusive, the party there should remember what happened between 1999 and 2003.
These were the words of Celestí Alomar, who was Balearics tourism minister during the first PSOE-led government from 1999 to 2003. He wrote them the year after PSOE had lost the 2003 election. It is clear that Alomar felt that the all-inclusive would die out and that it had been a response to what had been a trend away from the traditional package holiday. It is also clear that he was wrong and that there were further errors in his analysis. He spoke of the Spanish hotel industry having been, up till that point, reluctant to embrace all-inclusive and that, in 2004, it was something of a novelty.
He may have been right to point to novelty where Spanish tourism in total was concerned, but where the Balearics were concerned, he had seemingly forgotten what he had said in 2001. Two years into his position as minister, he gave an interview to the German magazine "Focus". In this he referred to the eight million tourists who came to Mallorca each year, roughly a half of them German, and to the all-inclusive offers that German tourists were taking up.
That interview caused a considerable stir, not because of the reference to all-inclusive but because Alomar was signalling the intention to radically reduce "mass tourism". Together with colleagues in the former Unió Mallorquina, policy was drawn up which sent out a message that Mallorca and the Balearics were no longer interested in the regular German tourist. It provoked a great deal of anger. When the eco-tax was then introduced (Alomar was partly responsible for it), the German market slumped. It was taking its revenge for both the insult implicit to the message of the interview and for the tax (though it should also be pointed out that the German economy was in its own slump at that time).
It is true to say that the traditional package holiday was under threat. It is also true to say that all-inclusive was a response to this threat. But when, in 2004, Alomar spoke of "irreparable damage" that all-inclusive could cause, he neglected the damage that he, Joan Mesquida (finance minister in the PSOE government) and Maria Antonia Munar (with her infamous utterances about Mallorca only wanting "quality" tourists) had sought to inflict.
Though one can't talk of there having been a co-ordinated counterattack, tour operators and hoteliers went on the counterattack. They responded to governmental policy and messages and to the eco-tax with what was a weapon of last resort - the all-inclusive.
In 2005, two years into the Partido Popular administration of Jaume Matas, the then tourism minister, Joan Flaquer, attributed the increase in all-inclusive to the "weakness" of the Balearics as a holiday destination. Flaquer was alluding to something of a "crisis" in the local tourism industry, detectable from 2002. He stated that his government and its policies were not the reason for the rise in all-inclusive. He was placing the blame firmly on the previous administration.
Alomar's "novelty" factor was plainly wrong in the Balearics context. In 1998, the year before he became PSOE's minister, it was reckoned that there were twenty hotels in the Balearics which offered all-inclusive. By 2003, when PSOE lost the election, there were 129. In fact, this rise was almost totally observable in 2003.
Business strategies quite separate to any political issues in the Balearics have to be taken account of, but is it an exaggeration to suggest that there was an all-inclusive-led counterattack? Is it inappropriate to talk of there having been a direct link between attitudes and policies of the PSOE administration and its Unió Mallorquina allies and the massive increase in the all-inclusive offer?
Flaquer tried, in both 2005 and 2006, to allay fears regarding all-inclusive. In 2005, he stated that the number of establishments offering it was plateauing. He was to be proved wrong. The following year, he spoke about a campaign involving the tourism and health ministries which was part of a set of measures to regulate all-inclusive. There was to be specific quality certification; there were to also be intensive inspections of hotels. Regulation was not proscription (it couldn't have been without a massive legal backlash), but the limited regulation that was supposedly introduced proved to be toothless.
Because of strategic product changes by tour operators, it can be too convenient to attach political blame for the explosion in all-inclusive. But when PSOE in Calvia, in a barely disguised, self-serving, pre-election move, now demand action against all-inclusive, the party there should remember what happened between 1999 and 2003.
Saturday, March 09, 2013
To Tourist Tax Or Not To Tourist Tax
The Catalonians are going to be coining in 45 million euros from their tourist tax this year. This is a lower amount than the 100 million that had been anticipated when the tax was first planned, but the difference can probably be explained by the downward adjustments that were subsequently made to the rates. I say "probably", but it will take until the end of this year to assess just how successful, or not, the tax is. Even if it rakes in a hefty amount, it will surely be deemed a failure if Catalonia were to suffer anything like a significant drop in tourism volume.
I don't anticipate that it will suffer a drop and nor does the director of the Catalonian tourism agency, if his forecasts for growth in, for example, the German market are anything to go by (the announcement of the estimated revenue from the tax was made at the Berlin travel fair).
The Catalonian tax is bound to be looked upon with interest by other regions of Spain. Catalonia is the only region with such a tax at present, but it may well not be the last, and though the regional government in the Balearics has ruled out there being a tourist tax in the islands, the possibility that the government might do a U-turn cannot be dismissed.
The memory of the Balearics eco-tax is one reason why the regional government would tread warily. Apart from the fact that it would be politically awkward for a Partido Popular-led government to introduce a tourist tax, when the previous tourist eco-tax was a PSOE invention and was subsequently scrapped by a PP government, there is all the baggage that remains from the eco-tax. It was unpopular for all sorts of reasons and with all sorts of "stakeholders", not least the hotels who were expected to collect it.
There are myths that have grown up around the eco-tax, one of them being that it caused a fall in tourism. In actual fact, the figures for total tourism arrivals to the Balearics in 2002 (the year in which the tax was implemented) and in 2003 show that tourism increased, not hugely but by around 300,000. Academic studies of the eco-tax have since suggested that it had relatively little impact and that what sluggishness there may have been at that time was due more to the stagnant nature of the German economy than to the tax.
The chances of a tourist tax in the Balearics being revisited have to be put in the context of not only the experience of the eco-tax but also the present day. Since 2002/2003, various tax changes have affected tourists - tax rises in their own countries and air duties, for example. So the tourist is being hit harder and harder by tax. This hasn't, however, stopped the Catalonians from introducing their tourist tax, and this despite rises in IVA (VAT) in Spain as a whole.
The Balearics, though, have their own mini eco-taxes, the one that most directly affects tourists being the tax on car hire. Criticised by tour operators and ABTA as well as by local business associations, it is a discriminatory tax, which was a key criticism of the old tourist eco-tax The government dresses it up as a green tax, when it is nothing of the sort. It is a tax which in fact limits the government's room for manoeuvre. A tourist tax, implemented correctly, as the Catalonian one is being and as the previous eco-tax in the Balearics wasn't, is not discriminatory and would have potentially far greater revenue-raising potential than the car-hire tax. But having settled on discriminatory taxes, the government would now find it difficult to backtrack and scrap these taxes in favour of a broader tourist tax. If Catalonia's tax proves to be a success, a Balearics move to establish a similar tax would then smack of copycatism and opportunism.
The mini eco-taxes are also for general tax-raising purposes in order to reduce the regional government's deficit. They are, therefore, unlike the Catalonian tourist tax which is more progressive in the sense of being used for developing tourism and so growing the economy - it is to be used, and this has been established in law, for tourism marketing purposes alone. The Balearics taxes will neither develop tourism nor help to grow the economy, despite the bizarre assertion of the regional government that higher taxes are good for the economy.
Of course, any tax or tax rise can be considered detrimental to growth, but there are taxes which are less price-sensitive and so less price-elastic than others. And the Catalonians may discover that its tourist tax is one of them.
Any comments to andrew@thealcudiaguide.com please.
I don't anticipate that it will suffer a drop and nor does the director of the Catalonian tourism agency, if his forecasts for growth in, for example, the German market are anything to go by (the announcement of the estimated revenue from the tax was made at the Berlin travel fair).
The Catalonian tax is bound to be looked upon with interest by other regions of Spain. Catalonia is the only region with such a tax at present, but it may well not be the last, and though the regional government in the Balearics has ruled out there being a tourist tax in the islands, the possibility that the government might do a U-turn cannot be dismissed.
The memory of the Balearics eco-tax is one reason why the regional government would tread warily. Apart from the fact that it would be politically awkward for a Partido Popular-led government to introduce a tourist tax, when the previous tourist eco-tax was a PSOE invention and was subsequently scrapped by a PP government, there is all the baggage that remains from the eco-tax. It was unpopular for all sorts of reasons and with all sorts of "stakeholders", not least the hotels who were expected to collect it.
There are myths that have grown up around the eco-tax, one of them being that it caused a fall in tourism. In actual fact, the figures for total tourism arrivals to the Balearics in 2002 (the year in which the tax was implemented) and in 2003 show that tourism increased, not hugely but by around 300,000. Academic studies of the eco-tax have since suggested that it had relatively little impact and that what sluggishness there may have been at that time was due more to the stagnant nature of the German economy than to the tax.
The chances of a tourist tax in the Balearics being revisited have to be put in the context of not only the experience of the eco-tax but also the present day. Since 2002/2003, various tax changes have affected tourists - tax rises in their own countries and air duties, for example. So the tourist is being hit harder and harder by tax. This hasn't, however, stopped the Catalonians from introducing their tourist tax, and this despite rises in IVA (VAT) in Spain as a whole.
The Balearics, though, have their own mini eco-taxes, the one that most directly affects tourists being the tax on car hire. Criticised by tour operators and ABTA as well as by local business associations, it is a discriminatory tax, which was a key criticism of the old tourist eco-tax The government dresses it up as a green tax, when it is nothing of the sort. It is a tax which in fact limits the government's room for manoeuvre. A tourist tax, implemented correctly, as the Catalonian one is being and as the previous eco-tax in the Balearics wasn't, is not discriminatory and would have potentially far greater revenue-raising potential than the car-hire tax. But having settled on discriminatory taxes, the government would now find it difficult to backtrack and scrap these taxes in favour of a broader tourist tax. If Catalonia's tax proves to be a success, a Balearics move to establish a similar tax would then smack of copycatism and opportunism.
The mini eco-taxes are also for general tax-raising purposes in order to reduce the regional government's deficit. They are, therefore, unlike the Catalonian tourist tax which is more progressive in the sense of being used for developing tourism and so growing the economy - it is to be used, and this has been established in law, for tourism marketing purposes alone. The Balearics taxes will neither develop tourism nor help to grow the economy, despite the bizarre assertion of the regional government that higher taxes are good for the economy.
Of course, any tax or tax rise can be considered detrimental to growth, but there are taxes which are less price-sensitive and so less price-elastic than others. And the Catalonians may discover that its tourist tax is one of them.
Any comments to andrew@thealcudiaguide.com please.
Thursday, June 14, 2012
The Tourist Tax Lottery
Celestí Alomar, the one-time Balearics tourism minister, said the other day that had the eco-tax been allowed to continue it would by now have realised some 800 million euros worth of investment. 800 million; that's a fair old wedge. The eco-tax was not designed for such purposes, but 800 million would have wiped out the debt that the Balearics health service has and left a goodly amount left over to pay for Palma's Palacio de Congresos and any other number of projects.
Alomar would of course defend the eco-tax and big up the lost opportunity of investment through its continued imposition. He was the tourism minister who introduced it. He was no longer tourism minister when, two years after the tax was brought in, the then government of Jaume Matas scrapped it.
Much as the eco-tax was unpopular and ill-conceived, with hindsight one could argue that there was a good deal of foresight in its introduction. Taxes have come in elsewhere, and Catalonia will bring in its tourist tax from November this year. It was the implementation, the discriminatory basis of the tax and the PR that were wrong, not the eco-tax per se.
The tax had merit, and as a general principle, I believe that tourists should make some form of contribution to services and what have you in their destinations. I know, I know ... tourists pay for services, these services are taxed, businesses pay tax on receipts. I know all this, but this is not an argument which invalidates the concept of a direct contribution to help fund certain services.
Take the health service, for example. Hugely in debt, as everyone knows, it is a health service that is at the disposal of tourists. Indeed, the quality of health service is something which has been identified as being key to future tourism development; not by health tourists but as a vital service to an ageing population that comprises a good chunk of the tourism market. The local health service is hard-pressed as it is. It becomes more so during the main season, especially if some tourists insist on going around jumping off balconies.
Though there are no plans to re-introduce a tax in the Balearics, were there to be, how much would it be? The Catalonia tax has varying rates depending on type of accommodation and where it is. It complicates things, but there is some sense in tourists heading for four or five-star accommodation paying slightly more, but then a similar system of a higher rate would need also to apply to luxury villas. The implementation of such a system is what becomes difficult, and implementation was one of the problems with the eco-tax.
But assuming an efficient system could be established and that a Balearics tax were to be along similar rates as to that in Catalonia, an average tax revenue of around ten euros per tourist would be generated (Catalonia's is to be charged for a maximum of seven nights but won't be levied on children under 16). As a rough estimate, the Balearics could raise in the region of 70 to 80 million euros a year, which over ten years would be getting on for 800 million, as Alomar has claimed the eco-tax would have generated.
This is a significant sum, but as soon as the T-word is mentioned, everyone gets into a lather. So rather than a tax, what about something else? Ladies and gentlemen, I offer for your consideration the Balearics tourist lottery, i.e. the tax would still be applied but would be for a lottery.
Don't ask me how this might be implemented, as it is simply an idea that has flown into my mind. Among other things, a change to tax law would be needed as currently if a tourist were to win the Spanish national lottery and take the winnings out of Spain, he would be liable for tax. But if there were to be a lottery, with a good range of prizes, yes some of the revenue would have to be paid back in the form of prizes, say 20%, but it could well be far more acceptable to tourists. If these lotteries were weekly, then why not also, during the high season in particular, have roadshows hitting different resorts to make the draws. Entertainment, bands, stuff for kids, whatever. This would take some more out of the pot, but it would be strong PR and would represent regular "tourist days" rather than the annual one-offs that occur in Alcúdia for example.
Tax. Lottery. Both would generate revenue, but a lottery would be a whole load more fun and potentially a whole load less painful.
Any comments to andrew@thealcudiaguide.com please.
Alomar would of course defend the eco-tax and big up the lost opportunity of investment through its continued imposition. He was the tourism minister who introduced it. He was no longer tourism minister when, two years after the tax was brought in, the then government of Jaume Matas scrapped it.
Much as the eco-tax was unpopular and ill-conceived, with hindsight one could argue that there was a good deal of foresight in its introduction. Taxes have come in elsewhere, and Catalonia will bring in its tourist tax from November this year. It was the implementation, the discriminatory basis of the tax and the PR that were wrong, not the eco-tax per se.
The tax had merit, and as a general principle, I believe that tourists should make some form of contribution to services and what have you in their destinations. I know, I know ... tourists pay for services, these services are taxed, businesses pay tax on receipts. I know all this, but this is not an argument which invalidates the concept of a direct contribution to help fund certain services.
Take the health service, for example. Hugely in debt, as everyone knows, it is a health service that is at the disposal of tourists. Indeed, the quality of health service is something which has been identified as being key to future tourism development; not by health tourists but as a vital service to an ageing population that comprises a good chunk of the tourism market. The local health service is hard-pressed as it is. It becomes more so during the main season, especially if some tourists insist on going around jumping off balconies.
Though there are no plans to re-introduce a tax in the Balearics, were there to be, how much would it be? The Catalonia tax has varying rates depending on type of accommodation and where it is. It complicates things, but there is some sense in tourists heading for four or five-star accommodation paying slightly more, but then a similar system of a higher rate would need also to apply to luxury villas. The implementation of such a system is what becomes difficult, and implementation was one of the problems with the eco-tax.
But assuming an efficient system could be established and that a Balearics tax were to be along similar rates as to that in Catalonia, an average tax revenue of around ten euros per tourist would be generated (Catalonia's is to be charged for a maximum of seven nights but won't be levied on children under 16). As a rough estimate, the Balearics could raise in the region of 70 to 80 million euros a year, which over ten years would be getting on for 800 million, as Alomar has claimed the eco-tax would have generated.
This is a significant sum, but as soon as the T-word is mentioned, everyone gets into a lather. So rather than a tax, what about something else? Ladies and gentlemen, I offer for your consideration the Balearics tourist lottery, i.e. the tax would still be applied but would be for a lottery.
Don't ask me how this might be implemented, as it is simply an idea that has flown into my mind. Among other things, a change to tax law would be needed as currently if a tourist were to win the Spanish national lottery and take the winnings out of Spain, he would be liable for tax. But if there were to be a lottery, with a good range of prizes, yes some of the revenue would have to be paid back in the form of prizes, say 20%, but it could well be far more acceptable to tourists. If these lotteries were weekly, then why not also, during the high season in particular, have roadshows hitting different resorts to make the draws. Entertainment, bands, stuff for kids, whatever. This would take some more out of the pot, but it would be strong PR and would represent regular "tourist days" rather than the annual one-offs that occur in Alcúdia for example.
Tax. Lottery. Both would generate revenue, but a lottery would be a whole load more fun and potentially a whole load less painful.
Any comments to andrew@thealcudiaguide.com please.
Thursday, December 22, 2011
Taxing The Tourist
Might the Balearics revive the eco-tax or create some similar tourist tax? The government has hitherto discounted the notion, but it may well be looking across the sea to the mainland and to Catalonia where a tax is to be introduced in 2012.
The Catalonian tax envisages payments for a maximum of ten nights of a stay, and it will apply to hotels, apartments, cruise ships, camping areas and rural properties - pretty much everything, in other words. Five-star hotels will attract a rate of three euros a night, four-stars two euros a night and the rest one euro. Children under 12 will be exempt. It is estimated that the tax will raise in the region of 100 million euros and the money will be used primarily for tourism promotion.
The Balearics eco-tax was introduced in 2003 by the then socialist government of President Antich and was abandoned a year later by the Partido Popular administration. The tax attracted significant amounts of bad publicity and warnings of the harm it would cause to the local tourism industry. It was unpopular because it was unilateral, i.e. other regions of Spain didn't have such a tax.
For all that the tax was not well thought-out (it was essentially discriminatory in that the hotels were the channel of collection), the principle behind it had merit. In purely moral terms, it is not unreasonable, for example, to expect tourists to contribute to the provision of resources and services, while the application of a tourism tax is a well-enough established practice in different parts of the world.
A counter argument against the tax was that tourists already contributed, albeit indirectly, through their spend that supported local businesses which in turn paid taxes. This was also reasonable and, especially among tourist "veterans" who had been coming to Mallorca for years, there was some resentment at being asked to pay when they had been contributing for so long.
Since 2003 though, one thing has changed and that is the increase in all-inclusives. It might seem unfair to penalise tourists who don't stay in an all-inclusive, but the level of spend in resorts with high concentrations of all-inclusive has unquestionably been affected, with the result that the contribution to the local economy has gone down.
Another thing that has changed is that competition from other destinations has become steadily more intense. A concern that a local tax in 2003 might have put the Balearics at a disadvantage with other parts of Spain would now be one of worries about boosting tourism to other countries. However, and as events have shown, this competition can come with a caveat, one of potential disruption.
The competition argument isn't the strongest, and it isn't one that seems to bother the Catalonian government. Instead, faced with a budget cut to tourism of one-third in 2012, it is looking to the tax to enable it to strengthen its marketing clout in beating off the competition.
A problem for Catalonia, however, is that a tax, were it widely known to be earmarked for promotion, would not necessarily play well with tourists. It would be reasonable for visitors to believe that this was something that they should not have to pay for. Though the Balearics eco-tax was mishandled, if the PR were done effectively, tourists would be more likely to accept paying for the environment or for good works. Promotion, a matter very much for a regional government and its tourism industry and it alone, is different.
More than all this though, there is an issue with the drip-drip effect of added costs to the tourist. To a local tax can be added charges such as those imposed by the British and German governments on air travel. The cumulative effect of the drip-drip would not mean tourists opting for a competitor destination (especially as air duties are universal and indeed higher for longer distances), but it would most likely eat more into the spend once at the destination. On the basis of what Catalonia intends to introduce, a family of four with two teenagers at a three-star hotel would pay 40 euros more. This might not seem a lot, but cumulatively, for the tourism population as a whole, it may well result in spend decreasing even more. What is gained through a direct contribution would be lost from an indirect contribution.
On balance, however, the Balearic Government might be advised to re-visit the concept of a tourism tax, if only on moral grounds.
Any comments to andrew@thealcudiaguide.com please.
The Catalonian tax envisages payments for a maximum of ten nights of a stay, and it will apply to hotels, apartments, cruise ships, camping areas and rural properties - pretty much everything, in other words. Five-star hotels will attract a rate of three euros a night, four-stars two euros a night and the rest one euro. Children under 12 will be exempt. It is estimated that the tax will raise in the region of 100 million euros and the money will be used primarily for tourism promotion.
The Balearics eco-tax was introduced in 2003 by the then socialist government of President Antich and was abandoned a year later by the Partido Popular administration. The tax attracted significant amounts of bad publicity and warnings of the harm it would cause to the local tourism industry. It was unpopular because it was unilateral, i.e. other regions of Spain didn't have such a tax.
For all that the tax was not well thought-out (it was essentially discriminatory in that the hotels were the channel of collection), the principle behind it had merit. In purely moral terms, it is not unreasonable, for example, to expect tourists to contribute to the provision of resources and services, while the application of a tourism tax is a well-enough established practice in different parts of the world.
A counter argument against the tax was that tourists already contributed, albeit indirectly, through their spend that supported local businesses which in turn paid taxes. This was also reasonable and, especially among tourist "veterans" who had been coming to Mallorca for years, there was some resentment at being asked to pay when they had been contributing for so long.
Since 2003 though, one thing has changed and that is the increase in all-inclusives. It might seem unfair to penalise tourists who don't stay in an all-inclusive, but the level of spend in resorts with high concentrations of all-inclusive has unquestionably been affected, with the result that the contribution to the local economy has gone down.
Another thing that has changed is that competition from other destinations has become steadily more intense. A concern that a local tax in 2003 might have put the Balearics at a disadvantage with other parts of Spain would now be one of worries about boosting tourism to other countries. However, and as events have shown, this competition can come with a caveat, one of potential disruption.
The competition argument isn't the strongest, and it isn't one that seems to bother the Catalonian government. Instead, faced with a budget cut to tourism of one-third in 2012, it is looking to the tax to enable it to strengthen its marketing clout in beating off the competition.
A problem for Catalonia, however, is that a tax, were it widely known to be earmarked for promotion, would not necessarily play well with tourists. It would be reasonable for visitors to believe that this was something that they should not have to pay for. Though the Balearics eco-tax was mishandled, if the PR were done effectively, tourists would be more likely to accept paying for the environment or for good works. Promotion, a matter very much for a regional government and its tourism industry and it alone, is different.
More than all this though, there is an issue with the drip-drip effect of added costs to the tourist. To a local tax can be added charges such as those imposed by the British and German governments on air travel. The cumulative effect of the drip-drip would not mean tourists opting for a competitor destination (especially as air duties are universal and indeed higher for longer distances), but it would most likely eat more into the spend once at the destination. On the basis of what Catalonia intends to introduce, a family of four with two teenagers at a three-star hotel would pay 40 euros more. This might not seem a lot, but cumulatively, for the tourism population as a whole, it may well result in spend decreasing even more. What is gained through a direct contribution would be lost from an indirect contribution.
On balance, however, the Balearic Government might be advised to re-visit the concept of a tourism tax, if only on moral grounds.
Any comments to andrew@thealcudiaguide.com please.
Tuesday, September 07, 2010
The German Air Force: Tourist and air taxes
The Germans are creating a stink. From next year there will be an air tax applied to all tickets for outgoing flights from German airports; the levy will amount to eight euros for a flight to Mallorca. German airlines are none too impressed with the Merkel government's decision, Lufthansa saying that it will have to pass on the tax, the director general of Air Berlin in Spain and Portugal, the former head of the Mallorca Tourism Board (Fomento del Turismo), describing it as totally absurd, and Balearics president Antich also condemning the measure.
This is not exactly the first time that a major market for Mallorca has introduced such a tax. Who else? The UK, for one. The air passenger duty is set to rise to twelve pounds in November this year. Has it had a negative impact? Well, has it?
The Dutch are ones who would argue that this type of tax can be harmful. They abandoned theirs a year or so after it had been introduced. One drawback to the Dutch scheme was that passengers nipped over the border to Germany where there was no tax. Then. Or at least that's what they said. Add on the costs of getting to a German airport, and the saving was probably marginal at best. Nevertheless, the Dutch did apparently experience an overall loss on the deal.
Air taxes, tourist taxes, call them as you will, are easily justified - by governments and the environment lobby - as ways of saving the planet, a justification that has more than the hint of dissemblance, to say nothing of hypocrisy. Build another runway here or there, crank the number of flights up, haul in the tax cash. The environment is served better by improved aircraft efficiency, which is why the British government toys with the idea of a levy on older, less-efficient planes.
The taxes are a system of revenue generation, why not come clean? The airlines believe this to be so and that they are viewed as cash cows to be milked by bankrupt governments.
Into this argument, locally, comes a comparison being drawn between the German decision and the abandoned eco-tax. If you don't recall the fuss that caused ... the plan was to levy a tax of one euro per night on tourists. It was a crap scheme, not because there wasn't some sense behind it, but because it was highly discriminatory: the tax was to be gathered by hotels and other providers of accommodation. It took no account of other types of visitor.
The then socialist-led government, presided over by the current president, was quite clear as to the purpose of the tax; it was to be used, in effect, to clear up the mess years of tourism had created. Whether the money would ever have been used wisely, who can tell? And we were to never find out because the Partido Popular came into power a year after its introduction and scrapped it, the tourism minister of the time claiming that it had caused a reduction in tourism, something which the UK travel industry, for one, didn't necessarily agree with. His predecessor, who is now the head of the dreaded Costas authority, said in 2001 that the tax was a consequence of the Balearics "tiring of cheap, destructive tourism".
Things have changed since 2001, one change being the more rapid growth in low-cost airlines: from the UK and from Germany. As "The Bulletin" has asked, it is legitimate to question how President Antich squares his opposition to the German tax with the abandoned eco-tax. Does Mallorca now wish to carry on with "cheap and destructive tourism", contrary to the view nine years ago, keeping flights from Germany as cheap as possible?
Another thing that has changed of course is the increase in competition to Mallorca, hence, one supposes, Antich's opposition. But the tax would be universal in terms of destination; it wouldn't just be Mallorca. So where, really, is the problem? The British have lived with it, the Germans, generally more eco-conscious than the British anyway, would probably stomach it, and German treasury coffers would swell. Where a problem would lie, potentially, would be if the eco-tax were to be revisited. There is support for such a thing. For example, there is a group calling itself "Mallorca Goes Green". This advocates a ten euro tax on any visitor coming into the island via ports or the airport. A double-whammy tax might just make people think twice about flying to Mallorca. Or it might not. And even were it to, as I pointed out a couple of days ago, Mallorca can afford to lose tourists - cheap and destructive ones, if you like.
Any comments to andrew@thealcudiaguide.com please.
This is not exactly the first time that a major market for Mallorca has introduced such a tax. Who else? The UK, for one. The air passenger duty is set to rise to twelve pounds in November this year. Has it had a negative impact? Well, has it?
The Dutch are ones who would argue that this type of tax can be harmful. They abandoned theirs a year or so after it had been introduced. One drawback to the Dutch scheme was that passengers nipped over the border to Germany where there was no tax. Then. Or at least that's what they said. Add on the costs of getting to a German airport, and the saving was probably marginal at best. Nevertheless, the Dutch did apparently experience an overall loss on the deal.
Air taxes, tourist taxes, call them as you will, are easily justified - by governments and the environment lobby - as ways of saving the planet, a justification that has more than the hint of dissemblance, to say nothing of hypocrisy. Build another runway here or there, crank the number of flights up, haul in the tax cash. The environment is served better by improved aircraft efficiency, which is why the British government toys with the idea of a levy on older, less-efficient planes.
The taxes are a system of revenue generation, why not come clean? The airlines believe this to be so and that they are viewed as cash cows to be milked by bankrupt governments.
Into this argument, locally, comes a comparison being drawn between the German decision and the abandoned eco-tax. If you don't recall the fuss that caused ... the plan was to levy a tax of one euro per night on tourists. It was a crap scheme, not because there wasn't some sense behind it, but because it was highly discriminatory: the tax was to be gathered by hotels and other providers of accommodation. It took no account of other types of visitor.
The then socialist-led government, presided over by the current president, was quite clear as to the purpose of the tax; it was to be used, in effect, to clear up the mess years of tourism had created. Whether the money would ever have been used wisely, who can tell? And we were to never find out because the Partido Popular came into power a year after its introduction and scrapped it, the tourism minister of the time claiming that it had caused a reduction in tourism, something which the UK travel industry, for one, didn't necessarily agree with. His predecessor, who is now the head of the dreaded Costas authority, said in 2001 that the tax was a consequence of the Balearics "tiring of cheap, destructive tourism".
Things have changed since 2001, one change being the more rapid growth in low-cost airlines: from the UK and from Germany. As "The Bulletin" has asked, it is legitimate to question how President Antich squares his opposition to the German tax with the abandoned eco-tax. Does Mallorca now wish to carry on with "cheap and destructive tourism", contrary to the view nine years ago, keeping flights from Germany as cheap as possible?
Another thing that has changed of course is the increase in competition to Mallorca, hence, one supposes, Antich's opposition. But the tax would be universal in terms of destination; it wouldn't just be Mallorca. So where, really, is the problem? The British have lived with it, the Germans, generally more eco-conscious than the British anyway, would probably stomach it, and German treasury coffers would swell. Where a problem would lie, potentially, would be if the eco-tax were to be revisited. There is support for such a thing. For example, there is a group calling itself "Mallorca Goes Green". This advocates a ten euro tax on any visitor coming into the island via ports or the airport. A double-whammy tax might just make people think twice about flying to Mallorca. Or it might not. And even were it to, as I pointed out a couple of days ago, Mallorca can afford to lose tourists - cheap and destructive ones, if you like.
Any comments to andrew@thealcudiaguide.com please.
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