Spain Keeps Reduced VAT for Tourism, Explores Tourist Taxes After Catalan Row
The tourism ministry ruled out a restaurant VAT hike after a Catalan economist urged withdrawing implicit subsidies to steer growth away from low-value tourism.
Overview
- State secretary Rosario Sánchez said the government supports maintaining the sector’s 10% reduced VAT and is open to expanding tourist levies like those used in Catalonia.
- The dean of the Col·legi d'Economistes de Catalunya said the body does not back raising VAT now following Josep Oliver’s call to phase out implicit support such as the 10% rate, free motorways and lighter taxes on alcohol, tobacco and fuels.
- Industry groups and unions rejected tighter taxation, warning of hits to activity and jobs in a sector employing about 2.9 million people in Spain, roughly 13.5% of social security affiliates.
- Economists remain divided, with figures such as Guillem López-Casasnovas and Miquel Puig urging study of tougher fiscal tools while others caution about employment and output effects.
- Oliver argues curbing tourism incentives would help counter Catalonia’s long-run deindustrialization and low productivity, concerns also highlighted by regional economic officials.