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Despite complaints, no change to the tourist tax

Tourists paying the tourist tax at a hotel. | MERCÈ PONS¶

| Palma |

Finance minister Rosario Sánchez explained during a radio interview on Tuesday that the 2020 budget will be "prudent". This will reflect the "moderation" of the Balearic economy and uncertainties regarding financing from Madrid and levels of tax revenue from property transfers. The latter two have already required a downward modification in 2019 government spending.

There is, as Sánchez noted, a 177 million euros gap that is a specific consequence of the difficulties that her namesake - Pedro Sánchez - is having in forming a government and therefore approving a new state budget. On property transfer tax, she observed that revenue from the sale of properties fell by 40 million euros over the first five months of this year. The general scenario is not positive in that there was a ten per cent fall in property sales up to June.

The minister added that there are no plans for introducing new taxes in 2020 and nor are there plans to cut any existing tax rates. Although hoteliers have complained about a fall in bookings this summer, the tourist tax rates will stay as they are. "We are not intending any possible flexibility with the sustainable tourism tax next year."

Government forecasts for economic growth have been cut from 2.7% to 2.2% at most. Despite this moderation, Sánchez said that there will still be scope for various projects, such as railways and housing.

The minister and the government have until the end of October to present the 2020 budget to parliament. Prior to this, a decision will be needed on the spending ceiling, which for 2019 was slightly more than 5,000 million euros.

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