8,700 illegally rented holiday homes discovered in the Balearic Islands

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illegally rented holiday apartments
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To slow down the unbridled growth of holiday homes in Spain, various governments are first trying to track down illegal tourist rentals. To this end, the island authorities on the Balearic Islands recently exchanged their data with the regional Tax Authorities (ATIB). This has revealed 8,700 illegally rented tourist homes.

The action was announced last September by the government of the archipelago, which includes Ibiza and Mallorca. This involved the detection of actively rented properties for which no eco tax (ITS) is paid. The ATIB discovered homes that either appear in the municipal registers and do not pay the ecotax, or do pay but are not registered. It should be noted that for the time being this only concerns the data from Mallorca and Menorca. Those from Ibiza are still being analysed.

Sanctions

The usual course of events in this case is that the owners of homes in irregular situations are firstly informed. The ATIB will then check the homes and possibly open sanction files for failure to pay the required tax. All data is then transferred to the island authorities so that they can take their own appropriate measures.

Measure supported by EU ruling

Rental properties that appear on online marketing platforms such as Booking, Airbnb or Tripadvisor were therefore examined to determine whether or not they have paid the ITS eco tax. The ruling of April 27, 2022 by the Court of Justice of the European Union (CJEU) supports the measure. It stipulated that intermediaries, such as these platforms, are obliged to provide tax information to the tax authorities to see whether the correct taxes are being collected.

Cogesa Expats

Booking cooperates

Rental platform Booking has promised to make a better contribution to streamlining this process. The regional government and Booking announced their agreement to this effect during the last tourism fair FITUR in January in Madrid. They set up the joint project as a pilot before the entry into force of the new European regulations that oblige the company to more transparency in the field of short-term accommodation rental.

Result only ‘preliminary’

According to the Balearic government, these results are nothing more than a taste of what is to come. The authorities will continue with the inspections, which they will also expand and optimise. Moreover, they will also involve channels other than traditional marketing platforms in the investigation of illegal holiday homes. In October, the regional government estimated that a total of around 235,000 homes on the islands are being used illegally as holiday rentals. On the other hand, the Spanish bank released a report at the end of April stating that the Balearic Islands need 15,740 homes to meet the current demand for housing from residents.

“Unfair competition”

The President of the Balearic Government said: “The illegal supply of holiday homes represents unfair competition for both hotel accommodation and regulated holiday accommodation. It is detrimental to our quality as a destination and to our image to those who visit us. It only contributes to receiving a surplus of tourists without any control”.

Also read: Growing rebellion against mass tourism in Spain

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