This is the official name of the new ‘Eco Tax’ that comes into force on July 1st and applies to all visitors to the Balearic Islands this year – including Ibiza. The tax is intended to defray the costs of putting the island back together again after three times the normal population of this tiny island have finished having a party for six months!
It applies to all rented accommodation, hotels, villas and other self-catering accommodation in Ibiza, Mallorca and Menorca and operates on a sliding scale, from 50 cents per person per night if you’re camping or staying in a hostel, to €2 for luxury hotels and up-market apartments. After eight nights, the tax is halved. So a family of four including two children aged 16 who spend a fortnight at a four-star apartment or a five-star hotel would pay around £75 at today’s exchange rate.
In 2002 the islands introduced a similar tax, but it only applied for a single season: holidaymakers subsequently switched to lower-cost destinations such as Egypt, Turkey and Tunisia. That’s not going to happen this year. Indeed, Spain is likely to have its most successful summer ever, as a result of a reluctance of people to go to Turkey and Egypt, and the complete ban on package holidays to Turkey. Prices for flights and holidays have already increased as a result of the surge in demand.
The Balearics are by no means setting a precedent with their ‘Eco Tax’ – in Malta a new “environmental contribution” of €0.50 per night began in June. It only applies to over-18s, and there is a cap per holiday of €5 per person – that’s £4. It’s been very controversial, with the hotel industry on the island furious about its potential deterrent effect – and the fact that they have to collect it on the government’s behalf.
The New York City authorities have added a whole raft of taxes that put quoted hotel rates up by about 15 per cent. And in Britain, everyone staying in a hotel pays VAT at 20 per cent – something the British hospitality industry is furious about.
Governments, local and national, seem to like taxes that affect tourists – they’re easy to collect and, of course, overseas visitors don’t vote. Except with their feet.
The rest of Spain, and other Mediterranean nations, will be watching closely how holidaymakers respond to the new Balearics tax.