Tourist tax injunction escalates with bond demand by Mogán
The controversial new tourist tax adopted by one of Gran Canaria’s biggest tourist areas only to be blocked by the Canarian High Court hours after it entered into force has taken a further twist.
As reported here last week, the municipality of Mogán in the south of the island, which includes several popular resorts such as Puerto Rico, approved a mandatory tax (the first of its kind in the Canaries) of 0.15 euros per person per night’s stay in all local hotels, apartments and Airbnbs.
The levy aims to raise revenue to help the council pay for improvements to local infrastructure, the extra services required for mass tourism, and to ensure the overall sustainability of the tourism sector in Mogán.
The tax was swiftly opposed by the Las Palmas Hotel Federation (FEHT), which successfully applied for a court injunction to block the tax hours after its introduction due to the very damaging effect it says it will have on business. The Federation added by way of further argument that the administrative burden and formal obligations placed on accommodation establishments was disproportionate.
It has now emerged that Mogán is demanding that the FEHT deposit a bond of 1.2 million euros – the estimated revenue the controversial tax would generate for the council in its first year of operation – while the appeal against the tax is considered, which could take some time. In addition to seeking the deposit of the hefty bond, Mogán has also lodged a lengthy list of arguments against the injunction to the Canarian High Court. The Mogán tax is widely seen as a test case which could prompt other popular tourist areas of the Canaries to contemplate a similar revenue-generating measure.
