At present, the great majority of holiday rentals do not pay IVA (VAT). This is because they do not provide tourist services akin to those of hotels. Where these are provided, the IVA rate is the same as it is for hotels - ten per cent.
The government's tax measure would not only eliminate this distinction, it would remove IVA exemption altogether. The full 21% rate would apply to holiday rentals. The reason? "In order to reduce their profitability and transform them into housing for permanent rental, alleviating the lack of regular housing in stressed areas."
The manager of the Habtur holiday rentals association in the Balearics, María Gibert, hopes that the measure will not be accepted by Congress. "For now it is only a proposal and they do not have all the necessary support. It is a nonsense, as it harms the middle class, those families who rent out a property for a while."
There is also some confusion as to the potential application, a consequence in part of terminology. One aspect of this which has arisen is whether the intention is to apply IVA to all types of holiday rental or just to apartments. Reference to 'tourist apartments' has likewise raised alarm in the hotel sector.
The CEHAT hotel federation in Spain has drawn attention to the fact that a home dedicated to tourist activity is not the same as a tourist apartment with the AT registration, which is a type of regulated accommodation along hotel lines. These tourist apartments have key rather than star classifications and are subject to the 10% IVA regime.
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WildwoodWho are "everyone" who will benefit?
TDWhy would he sell up?! Jelous?
This is exactly what the big greedy hotel chains (who take money out of Mallorca) want. So the legal (and it costs loads) holiday rentals will be destroyed. That’s the locals. The illegal (they pay nothing guys) aren’t effected. Woo hoo for them!!! Big hotel CEOs love it - little locals are crushed. Will these little legal ETV’s become long term rentals??? No way - because the squatting laws (which benefits criminals, drug dealers and squatters) means that legal people aren’t safe. It beggars belief !!! Stupid, stupid people.
The Spanish Govt of any persuasion are notorious for taking money from the populace. They are considered nothing short of thieves. Take, take, take and waste, waste, waste. There’s no way I’d rent out my ETV to a longer term rental. The law that gives more rights to squatters than landlords needs serious attention first. All this Govt do is look for income streams and pass it off masquerading as some sort of magic wand solution, but it ain’t, by a country mile. Wankers!
Does anyone else feel like every week there's a total contradiction!? So there are too many tourists putting a huge strain on infrastructure; then we are shown the tourism fair and how they are promoting Mallorca to increase tourism. Now we are being told that private holiday rentals will be liable to 21% IVA to make those properties available to the housing market. But if 80% of tourists use hotels, that means the remaining 20% use private rental accommodation and will most likely opt to go elsewhere for their holidays than pay this extra expenditure. As most holiday lets are villas in the countryside or apartments in resorts that are like ghost towns in the winter, that's not really going to help Mallorquins who need to live and work in Palma! If this is to be levied, why do they not just apply it to the City of Palma and possibly the immediate surrounding areas rather than a blanket rule!? Just make a "no private tourist lets" zone!
This will benefit everyone. Trust us.
This is clearly a result of intense lobbying from the hoteliers associations. Ironically, mass tourism is more than 80% accommodated by hotels. And holiday lets are an increasing popular product for more upscale tourists, a product that hotels simply can't provide. They're also the main choice of off season tourism, and the character of tourist who is attracted to them are (generally speaking) not the destructive party animals that nobody wants. Other cities have banned them altogether, but so far, there's no tangible evidence that it's made housing more available or affordable. Besides, many of these holiday lets are of a caliber priced far more expensively than a hotel room, and as a long term rent, would always be out of reach of the average long term local renter. They'll be bought or rented by foreigners. At full market price. So, no impact at all. Just like in other cities. I doubt this will happen, but if it does, then there will need to be more hotel spaces to accommodate those tourists, and they'll need to stay open all year. Just what the hoteliers wish for. But they'd better have something more than a cold windy beach in a boarded up resort to attract them.
Great idea, I would make it 30%. The soonner colonisers like Morgan Williams sell up the better.
Higher Tax´s are not good for anyone in the short term good for the people in the Government when they splash a bit of money around to there friend´s obviously , they will tell you it´s a win win , most of them have never held or had a real Job which requires disipline and commitment soon it will lead to LOSE LOSE !