The President of the Balearics, Jose Ramon Bauza yesterday tried to ease the tension between the government and the business community over taxes.
Palma.Bauza told fellow MPs in Parliament yesterday that the three new so-called green taxes which will hit the packaging, large retail and car rental sectors are transient.
The new taxes have infuriated the business community which has told the government on numerous occasions that more taxes are only going to reduce the region's ability to compete on a national and international level.
And, relations between the business community and the government remain strained.
With large commercial centres, car rental agencies and packaging companies being hit by the new stealth taxes, the extra costs are going to be passed on to the consumer.
Travellers and travel companies are beginning to wake up to the new green tax being introduced on car hire as the date for its implementation looms.
From April 1 the new green tax will be payable locally, varying from 3 euros to 7.50 euros per day on top of the basic car high costs, and it is claimed to be responsible for a 40% reduction in booking for car hire in the Balearics since the decision to introduce the tax was announced. The tax will be collected directly by the car rental agents on collection of the car and will be an unwelcome extra for those who think they have paid for an inclusive rate. For larger vehicles, this could add nearly 100 euros to the cost of a rental car for a two week holiday.
But, Bauza claims that the taxes will only remain in place until his government has managed to balance the books and got the economy back on track.
The opposition, however, accused the President of electoral fraud for continuing to hike taxes and make the public pay.