Saturday, March 19, 2016

The Hodge-Podge Of A Tax

So, now we know that the tourist tax will be introduced from 1 July. Any advance on 1 May? Do I hear 1 June? Sold to the man with 1 July. At least some common sense has prevailed. If you have any thoughts of practicality in mind, you do not pass legislation and expect tax collection to begin almost a month later. Not, it has to be said, that practicality enters into the equation. The pathetic squabbling of this government and its "partner" Podemos over how the revenue is to be spent totally ignores the practicalities of how the revenue is supposed to be collected.

Only the hoteliers seem to know about collection. Inma Benito said at the Berlin fair that the hotels were resigned to having to collect it. "To do anything else would be to break the law." But go ask villa agencies and see if they know. The hotels, one also understands, will not now be bearing the cost of the tax. Or at least this seems to no longer be hotelier federation policy. Individual hotel chains may decide to, but that would be up to them.

Justifications for the tax have once more been parroted by the politicians. Biel Barceló observes that tourist taxes exist in many European countries. True, they do, but most are city taxes and not global ones. But where they do exist, their purpose tends to be, as is the case with hotel stay taxes in Germany or Rome, to add revenue to assist in paying for services and resources. My own view of the tourist tax, long held, is that justification can be made (in fact should be made) for tourists contributing to the cost of water, sewage and other vital services. But such a practical application warrants no consideration in the Balearics. The tax is a tax and now let's look for all sorts of spurious reasons to spend it.

Then there is the cost that the tourist will have to bear. It is a "small" one the politicians consistently inform us. In terms of the overall price of a holiday, it is. But the Balearic tax is not as small as some others. The regional politicians are greedy. They should look across the sea at Catalonia, where the rates are more moderate and where the tax ceases to be paid after seven days. This won't be the case here; only that a 50% reduction is to be applied after ten days. Greed.

What Barceló and others seem totally incapable of understanding is that they should take it as a compliment that a Balearic tax should arouse as much debate and scrutiny as it does. Catalonia's did not create anything like the same level of intense discussion. Why? Because the Costa Brava is not Mallorca. The island attracts attention, especially among the British and Germans, like nowhere else.

The arguments over the allocation of revenue - a cart before horse state of affairs if ever there was one - are most unlikely to cease now that the government has arrived at some form of compromise with Podemos. As Alvaro Gijón of the PP has intimated, the decisions on geographical distribution and the remaining 40% of revenue not included in this will probably lead to unseemly lobbying by municipalities to get their fingers in the pie. And let's guess which two might be leading the way. Gijón should know about one: he used to be the deputy mayor. No prizes for guessing the other.

The PP had been suggesting that they might see the government in court over the tax. They won't be. But the party remains dead against it. If it is returned to power in 2019, then the tax will doubtless go, just as it did when Jaume Matas won in 2003. The tax is a political tax, and everyone knows it is, one hewn from ideology, as Inma Benito suggests. The former minister for public administration, the PP's José Manuel Lafuente referred to the tax as a "hodge-podge" after Tuesday's parliamentary committee session. How right he is.

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