New tourism tax still a 'work in progress'

The new tourism tax intended to be launched last month is still a "work in progress", making its introduction before the summer peak even more remote.

The tax, postponed three times, was meant to come into effect by June. However, a spokesman for the Finance Ministry said it was still being reviewed. No decision had been taken on its implementation date and how the money would be collected, or how tourists could pay it.

The spokesman rebutted claims that the tax had been shelved, saying he had no more information on the matter.

The measure, announced last November for the 2010 Budget, proposed a 50c bed tax per tourist per night.

However, the decision was criticised by tourism operators who said it would undermine the main contributor to the country's economy. Hoteliers also lamented they would end up doubling as tax collectors.

This situation forced the government to postpone its introduction by a few months. But in April, after more resistance by a sector still reeling from the impact of the international crisis, it was postponed again to June.

The Malta Hotels and Restaurants Association (MHRA) insisted the new tax would add more burdens to operators weighed down by higher water and electricity bills.

The association entered into discussions with the government on the matter and it was decided to cap the tax at €3.50 per tourist, irrespective of the number of nights spent. The tax alone was expected to yield between €3.5 and €4 million per annum.

MHRA president George Micallef believes it is too late to try introducing the tax before the summer peak. The association had also agreed with the government that the levy would be preceded by an information campaign for tourists and stakeholders.

"It's too late to introduce it now or during the peak summer months when we already have to cope with high volumes. It would create havoc," he warned.

Mr Micallef said the one-off €3.50 contribution per tourist was acceptable because it did not discriminate against hotels and other licensed operators. However, he insisted on a campaign to explain to tourists how the tax would be collected, how it could be paid and where.

Last Monday, the Spanish city of Barcelona said it was considering imposing a tax on tourists of €1 per day to cover a cut in state subsidies aimed at promoting the city.