Pleading Poverty: Business eco-tax

I know many a business owner who pleads poverty. And almost as many who are claim to be in penury yet then show off their latest five thousand euro Rolex or race past you in a new Beemer sports utility vehicle en route to one of their five remaining fincas. I take much of this boracic special pleading with a rather larger pinch of salt than that which many below the breadline in Mallorca can afford. Occasionally, just ever so occasionally, I can indulge in the deliciousness of schadenfreude. Did you hear the one about the owner of a car-rental firm who took delivery of a 300 grand Ferrari and promptly wrote it off when taking it out for its first spin?

Not all of this impecuniousness is feigned. Sometimes it is genuine. But there are certainly businesses which are still doing very nicely thank you, despite what their owners might prefer you to believe. And some of these businesses are in the car-rental sector: primarily those with sufficient purchasing power to create volume and to be able to compete on price (up to a point). There are others in the sector which are not so lucky, the smaller operations. It was once explained to me - at length - how margins are for such small concerns. To describe them as low doesn't quite do them justice.

The car-rental sector is rightly angry with the regional government's immovability over the tax on car hire, especially as the government appears willing to negotiate with owners of large retail centres over the imposition of taxes on them. The retailers argue that the so-called environmental tax on their properties will leave them not making a profit. I don't believe this for one moment, just as I don't believe that larger car-rental firms will go to the wall because of the hire-car tax, but I do have some sympathy. Not huge amounts but some.

The government is having a laugh. Does it seriously expect us to believe that it is interested in saving the planet? To dub these latest taxes as environmental is an insult to everyone's intelligence. The government has eyed up where it might be able to extract further pounds of flesh and dressed this flesh up with the propaganda of the "eco". It is sophistry of the highest, or is it the lowest, order. A government which can, certainly if you believe our good friends GOB, march all over virgin beaches or, through its chums at the Council of Mallorca, reverse a previous decision and permit the building of the Sencelles golf development has little credibility when it comes to environmental righteousness. Its justification for the new taxes is garbage. Just call them taxes and don't try and kid anyone.

These taxes are examples of the ways in which governments, both the regional one and the national one, can make things up as they go along or suddenly discover some decision or law from the past and decide to implement it, a classic case in point being the 1988 coasts law, application of good parts of which had been on the statute book for almost twenty years before zeal in the name of the environment finally reared its head (ironically, given that the coasts law is now being reformed). This making up of things, typified by the tax-raising opportunism the regional government has dreamt up, does business no service. I would dearly love to know what Media Markt, having finally been able to open in Palma and having been prepared to invest in the local economy, make of suddenly potentially being presented with a tax demand because, allegedly, customers availing themselves of its products are polluting the atmosphere in the immediate environs of the Ocimax centre.

Businesses need certainty, yet the government appears not to understand this. All it does appear to understand, where business is concerned, is that which comes replete with en-suite bedrooms and lobbies with florally-adorned atriums. I still struggle to understand how a tax on retail centres does not also apply to larger hotel sites. Well, I do understand. The hotels would have a screaming fit, while their guests don't pollute the atmosphere as customers do by arriving by the car load at a hypermarket (no, but they do so in different ways).

The trouble is, though, that just as the government is making things up by arguing the green case for taxes, so some businesses play a propaganda game themselves. If they didn't play the poverty hand, there might be more and genuine sympathy for them. They should understand that there are increasing numbers of people in Mallorca who know what poverty means. New Rolex, anyone?


Any comments to andrew@thealcudiaguide.com please.