BRAKES PUT ON THE CAR HIRE TAX

By Humphrey Carter THE Balearic government announced yesterday that it does not intend to apply its highly controversial “car hire tax” this season. The good news was broken by the regional finance minister Lluis Ramis de Ayreflor who explained that the simple reason for the idea being shelved is that the bulk of the car hire sector opposes the tax. Ramis d'Ayreflor said that the government's bottom line over the introduction of the tax “has always been dependent on the majority support from the car hire sector. “If the car hire sector decides that it does not need the help of the Balearic government, then we will not get involved,” he added. “I have been in close contact with the car hire sector discussing the tax since it was approved by the government last December, but it appears that the industry is not convinced,” he said. The car hire tax was drawn up as a means of helping the small, independent car rental companies survive in the face of stiff competition from the multi-national chains who, according to the minister, make most of their money from car sales as opposed to car rental. The tax would have cost clients, mainly visitors to the Balearics hiring a vehicle, between two and six extra euros per day and was been received by negative press overseas. ABTA, the Association of British Travel Agents, warned when the tax proposal first emerged, that holidaymakers do not like extra charges. They especially do not like taxes which only serve to bump up the price of their holiday.