Balearic Islands to Increase Tourism Tax Amid Overtourism Concerns
MADRID – In a decisive move to manage the challenges of overtourism, the Balearic Islands of Spain are set to implement a significant increase in their tourism tax, along with a new levy on rental cars. This announcement was made by the regional government on Friday, indicating a growing concern over the impact of tourism on local communities and resources.
The current tourist tax, which stands at €4 (£3.30) per night, will rise to a maximum of €6 (£5) per person during the peak summer high season. This increase, pending approval from the regional parliament, will be structured at four different rates from March to December, with January and February remaining exempt from the tax.
Furthermore, cruise passengers visiting the islands between June and August will see their tourist tax tripled from €2 (£1.70) to €6 (£5) for each night of their stay. The introduction of a new levy on hire cars will specifically target vehicles brought in from other regions, affecting both tourists and rental car companies that transport vehicles to the islands for the summer season.
The Balearic Islands, a favored holiday hotspot for British travelers, encompass popular destinations such as Ibiza, Mallorca, Menorca, and Formentera. This tax hike follows a similar decision by Catalonia, which recently announced an increase in its own tourist taxes.
As the tourism sector grapples with its dual role of driving economic growth while contributing to a housing crisis, the Balearic Islands’ tourism minister, Jaume Bauzá, stated, “The islands have reached their limit.” Under the proposed regulations, platforms that advertise unlicensed properties will face fines that could soar to a maximum of €500,000 (£419,500), and new holiday rental flats will be prohibited within residential buildings.
This series of tax increases follows last year’s protests by residents who claimed that the influx of tourists was making it increasingly difficult to afford housing on the islands. As a testament to this rising concern, the average monthly rent in the Balearics has surged from €562 (£471) to €1,451 (£1,217) over the past decade, according to a study conducted by Fotocasa, a housing platform.
- Hoteliers and rental car companies have voiced their opposition to the tax increases, arguing that such measures could negatively impact the tourism industry, which constitutes nearly half of the islands’ GDP.
- Majorca’s hotel federation, FEHM, expressed that the rise in tourist tax could diminish tourists’ spending power, subsequently affecting local shops, restaurants, and the leisure sector.
- On the other hand, the federation has welcomed efforts to clamp down on unlicensed tourist rentals.
- The proposed new tax on rental vehicles has been labeled as “discriminatory and revenue-seeking” by the Baleval car rental association, which cautioned that it may not effectively alleviate the congestion of the archipelago’s roads during the busy summer months.
