Jason Moore08/10/2016 00:00
TW
3

A warning to the Balearic government: just because you got lucky with the tourist tax this summer season, it doesn't mean that your luck is going to hold. The controversial tourist tax was introduced with few problems in the summer and now the government has got confident. They are planning to raise the tax rate for next summer, which is a very bad idea. We must remember that this season was rather special. Security fears over resorts in North Africa meant that thousands of tourists were diverted to the Balearics; this was one of the reasons for the record summer.

But if these security fears ease, then the Balearics will be back to square one next season with an even higher rate of tax. Sterling is expected to remain low against the Euro for some time yet so the British, the biggest spenders in the Balearics, will be feeling the pinch. As we all know, these islands are not cheap in the first place so if you add an additional surcharge as well, then tourists just might go elsewhere. It also must be remembered that local hoteliers are taking legal action against the tourist tax, so really any rise should be left on the back-burner. What will happen if the hoteliers are successful and the courts rule that the tax is illegal? The money which has been raised will allegedly have to be repaid. A nightmare scenario.

What the Balearic government should do is continue with their charm offensive, underlining the merits of the tax and clearly showing where the money is being spent. The tourist tax was always going to be a big gamble. Many thought, myself included, that it would lead to a fall in bookings and also an outcry from tourists. This has not happened. But it is still early days. If competing resorts are cheaper, then tourists will simply vote with their feet. Now is the time to consolidate rather than plan tax increases.