Failed car hire tax costs Balearic councils seven million euros

Palma.—The botched attempt by the Balearic government to introduce a new tax on the rent-a-car business not only caused the industry on the island serious damage it also cost local councils more than seven million euros.
Car hire companies, faced with the threatened surcharge, decided to register their vehicles in other parts of the country and therefore escape the Balearic government´s proposed tax.
The Balearic government, as a result of the public outcry were forced to scrap the tax but by this stage it was too late. New vehicles, which operated on Balearic roads last summer were simply registered in places on the mainland, in a move  which cost local councils heavily.  The Balearic government, which was seeking ways to raise additional revenue, had taken aim at the car hire companies with a new ecology tax.  But the tourist trade went on the war path and after weeks of fighting the Balearic government performed a spectacular U-turn.