The Balearic Ecotax Conundrum

The Balearic Govt has this much common sense

On Friday evening (16 Nov 2018) I was interviewed by Jesus Rumbo for TEF (Television Eivissa Formentera) talking about the Balearic Ecotax levied on all adult tourists staying in licensed accommodation on the islands of Mallorca, Menorca, Ibiza and Formentera. The full interview (in Spanish) can be viewed via this link TEF interview 16 Nov 2018 but here’s a transcript of the interview.

Jesus Rumbo: Martín, at the World Travel Market there was much talk about the Balearic ‘Ecotax’. Why is there so much controversy about this tax?

Martin Makepeace: This is a very hot subject at the moment, I’ve spoken to my friends (in travel) who were at the World Travel Market (in London) and there was lots of talk about it.

JR: Good or bad?

MM: Both to be honest but I think the majority is negative because it’s a tax that isn’t transparent, the word I hear most is transparency, I think the tourists understand they have to pay but don’t know why or where the money goes.

JR: So it’s a tax they don’t understand?

MM: Yes and my personal opinion is that it’s unfair, if they said it was a hotel tax I can accept it but they say it’s a tourist tax yet the majority of tourists don’t pay it, only those that stay in legal establishments. So there’s a transparency problem plus the tourists that do pay don’t understand.

JR: So in the UK when they are explaining this tax, what do they say, what’s the message?

MM: The message is that it’s an ecological tax, the tax is to improve the infrastructure of the island, they have sold the idea on this theme but this is clearly not the case. Looking at the list of what they are going to spend it on, it’s not all ecological, so there’s a communication problem.

JR: Have you noticed that because of this tax there’s been a drop in business

MM: I think it affects things, we have lots of competition from other destinations and in the end the small things can have a big affect. A family of 4 who come to Ibiza with 2 teenage children could be paying more than 200 euros extra for their holiday which could affect their decision. I don’t like how they apply the tax as it affects the mentality of the tourist (who might come here).

JR: Is there a better way to apply the tax or to explain it?

MM: A tax is a tax but the problem here is they have sold it as an ecological tax and looking at the spending list it’s not. We have problems here on the island with sewage and if they spend it on this then great, it’s improving the island but they aren’t, they are spending it on cathedral windows, 19 houses for social welfare and they are spending it on the San Antonio promenade. I’m very happy that they are spending this money in San Antonio but is this ecological? I don’t know.

JR: From your perspective and the British perspective what a good use of this money?

MM: We have to improve the Islands infrastructure, we have the to improve Las Salinas for example, this is ecological, in the peak months the island is full of people and traffic. The money should be spent to improve the overall experience of Ibiza.

JR: Do you think it was a good idea that the Balearic Hoteliers brought so much attention on the tax at the World Travel Market or did they shoot themselves in the foot?

MM: I think it was a bad thing for Ibiza, now the island is in the press only for the bad things not the good things. The problem is that the hoteliers have been pushed and have had enough (of the tax) and I understand their position. I agree with them because it’s not clear what the money is for, there’s no transparency so I agree with the hoteliers but to go so strong against it in London, I’m not sure that was a good idea.

JR: Is British Tourism ecological and sustainable?

MM: Yes of course, the British love Ibiza, they will always return even with Brexit but as I said before, the small things matter, psychologically they affect us more, with the British the small things are sometimes more important than the big things.

JR: The brand of Ibiza is everything?

MM: The Ibiza brand and product is world class but we have to focus more on the tourist, they are the only commodity we have and I don’t like that we are putting this tax on them.

JR: The last question, in your opinion, do we continue with this tax or get rid of it?

MM: I think we should get rid of it, it’s an unfair tax.  Many people come here and don’t pay anything, we have a rich island yet many people don’t pay any taxes at all, we have to find another way to raise this money, we shouldn’t put it on to the tourist.


NOTE: The Balearic Ecotax is charged as follows (applicable to adults only – 16 years of age and over)

5 star hotels/apts: 4 EUR per person per night
4 star hotels/apts: 3 EUR pppn
1,2,3 star hotels/apts: 2 EUR pppn
Licensed Villas: 2 EUR pppn
Rural hotels: 2 EUR pppn
Cruise boats: 2 EUR pppn
Hostels, pensions, campsites: 1 EUR pppn
10% IVA (VAT) should be added to all taxes
75% discount in low season (01 Nov-30 Apr)
50% discount from the 9th day when staying in the same establishment

Author: Martin Makepeace

Englishman living and working in Ibiza since 1991. Entrepreneur with a passion for villas, boats, sunsets and San Antonio. Owner of Ibiza Property Shop and Ibiza Speedboats.

2 thoughts on “The Balearic Ecotax Conundrum”

  1. Well said Martin. You’re correct, the tax is unfairly levied and the budgeted spending is way outside what most people would consider to be ecological purposes.

    I’ve always advocated that if this tax MUST be levied everyone must pay! And a far easier way of collecting it would be a departure tax levied on people leaving the island, both by sea and air. It would be easy to administer – each traveller would buy a stamp at say, an estanco, stick it in his/ her passport and show it to an official at the airport. Cruise passengers fees would be dealt with by their cruise operator.
    Also, I would think that a €5 levy would be consideread reasonable by most people. It would mean a slower rate of collection but in the longer term a surer one. Moreover since it would be levied on ALL travellers, (except proven island residents) annually, it would be a known sum almost, and therefore borrowed against by the authorities in order to fund major infrastructure and environmental spending.
    As to spending, a responsible group of “wise men and women” selected from ALL sectors of the economy could be appointed to review spending bids submitted annually even by the Consell, the Ayuntiamentos, farmers organisations, Green and maritime organizations! Rather like the UK lottery good causes committee. However in this case they would have the power not just to allot money there would be a branch with supervisory powers over expenditure too.

    There! Sorted!

    BPR Carl.

    Like

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