Edition 1497
20 October 2018
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Algarve councils green-light tourist tax worth €20m per year – Silves and Tourism Board against it

by Carrie-Marie Bratley, in News · 27-09-2018 10:03:00 · 0 Comments

All of the Algarve’s local authorities bar one have said yes to a tourist tax of €1.50 per person, per night spent in the region, to be brought into effect from March 2019. However, Silves Council and the Algarve Tourism Board oppose it.

Algarve councils green-light tourist tax worth €20m per year – Silves and Tourism Board against it

The Algarve Intermunicipal Community AMAL approved the foundations for the tax to be introduced in a meeting held last Friday in Castro Marim, after 15 of the Algarve’s 16 municipalities gave it their nod of approval.
When it comes into force, the surcharge could reap as much as €20 million per year for the Algarve, which would be used to improve what is Portugal’s premier tourist destination.
The idea is to apply the fee on stays from March through to October, to a maximum of seven consecutive nights, with children aged 12 or under being exempt.
Due to its financial situation, the municipality of Vila Real de Santo António could introduce the tax from as early as next January.
The only council to vote against the tax was Silves, which said it will not be applying the add-on.
Now it is up to each individual council to approve the regulation of the tourist tax – which AMAL wants to bring into effect across the board from March next year – in their respective Municipal Assemblies.
Tavira Mayor Jorge Botelho, the head of AMAL, said the introduction of the surcharge “aims to, in some way, make the tourist pay with and during their stay, part of the costs that the municipalities foot”.
He was quick to stress that the measure will not have “any consequences whatsoever on demand”.
The municipal tourist tax is to be levied by all types of tourist development or local accommodation.
According to a previously-approved plan, part of the revenue, which has yet to be specified, will also be channelled into supra-municipal projects “that have a strong bearing on the tourism sector and the region”.
Among other possibilities, AMAL says it could be used for interventions in the areas of culture, restoration of heritage and campaigns to promote the region, within a framework yet to be defined, and in collaboration with a wide range of regional partners.
The northern city of Porto and Portugal’s capital Lisbon already exercise tourist taxes of €2 and €1, respectively.
In Porto, the revenue obtained from the tax imposed on visitors exceeded the city’s expectations by 50 percent.
According to the northern city, the tax, which came into force last March, generates an average of €750,000 a year for its coffers.
Porto is also looking to increase revenue obtained from local lodging, saying it hopes to have 90 percent of all licence holders pay the tourist tax by the end of the year.
In Lisbon, from 2016-2017, the €1 per person per night surcharge brought in an extra €18.5 million for the city’s coffers.
There, among other projects, it is being used to finance electric street cleaning vehicles, in what was a pilot project for the city.
Meanwhile, following the announcement of the Algarve tax, the region’s tourism chief has voiced his opposition to it.
In comments to newspaper Correio da Manhã, João Fernandes, said he “laments” the decision, and questioned the timing and “model chosen”.
“This is a wrong decision, which goes against tourist demand and could cause a loss of competitiveness for the Algarve”, he warned, adding the tax could “generate inequalities within the region and weaken the destination as a whole” because it will not be applied at the same time in all municipalities.
The heads of the Algarve’s two largest accommodation associations AHETA, the Algarve’s largest hotel and tourist resort association, and AIHSA, the Hotel Industry Association, have also said they agree with João Fernandes’ position on the matter.

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Edition 1497
20 October 2018
Edition: 1497

Read this week's issue online exactly as it appears in print.

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