It is not what the Balearic government wished for, but FITUR, Spain's largest travel trade fair which opens in Madrid today, is going to be overshadowed by the tourist tax. On Monday Balearic Minister for Tourism, Celesti Alomar, said that the Balearics will be promoting the region's corporate image in Madrid, not the tourist tax. But ever since the government's tax plans came to light, it has been the talk of Spain, not to mention the rest of Europe, with a number of autonomous governments carrying out their own tourist tax viability studies. However, based on the controversial Balearic model, no other regional government in Spain was bold enough to follow suit. To the contrary, the tourist boards in the Canaries and Andalucia are rubbing their hands with glee at the thought of all the tourists they will attract away from the Balearics. The Balearics hotel sector has vowed to take the issue as far as the European courts in order to block the tax and a study it commissioned concluded that the tax, due to raise an extra 60 million euros (10.000 million pesetas) a year for environmental management and protection, will in fact cost the Balearic economy 105.190 million pesetas in lost revenue. According to the study carried out by Ernst & Young, demand for tourist accommodation in the Balearics will fall by five per cent. The application of the tax to three star hotels will also reduce profits. The hoteliers maintain that 85 per cent of the Balearics' gross national product is generated by tourism and that the remaining 15 per cent is closely related, so any increase in holiday costs will also have negative knock-on effects for the auxiliary businesses. Hoteliers have also warned that the amount of money spent by tourists will fall by 37.434 million pesetas, 50 per cent of which is on accommodation. In view of the current condition of the Balearic holiday market, which is still very slow, hoteliers are repeating their calls that this is the worst possible time to start introducing new taxes. Their strategy for the moment is to keep lodging individual appeals against the tax with the Palma courts and eventually bring the courts to a halt with so many appeals that the tax's introduction will have to be postponed. Should that fail, the hotel sector, which has the full support of national hotel bodies, will take the Balearic government to court in Brussels. Balearic President Francesc Antich has said that the door is open for talks, but the hoteliers have given up all hope of reaching a deal with the government. With the tax due only to be collected at hotels and official apartment blocks - the government needs the co-operation of the hotel sector. At FITUR last year, the tourist tax was still a proposal, but now the government has announced its intention to enforce the tax in March. Balearic Ministers will have to answer to the Spanish travel industry over the next few days.

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