Government Seek Out Rental Rule Breakers
The Consell Insular Ibiza, are reported to have a group of ‘Informants’ circulating the island this summer to help identify illegal holiday rentals, and to inform unregistered homeowners of the fines they could face for their actions.
Viviana de Sans, General Secretary of the left wing Podemos party, and councillor responsible for housing in Ibiza, announced her intention earlier this year, to appoint the Government ‘spies’ to actively tour the island looking for telltale signs of illegal holiday rentals such as beach towels hanging on balconies, and to advise property owners that they are breaking the law. The opposition PP party has dismissed this approach as laughable and expressed the opinion that unregistered holiday rental owners already know they are breaking the law. They have jokingly suggested that locals do not hang beach towels on their balconies to avoid an “inspection of visit from the informants.”
The crackdown on unregistered holiday rentals has come about in response to a housing crisis amongst residents and workers. It has been reported that many working in the tourism sector cannot find or cannot afford suitable accommodation. The influx of employees needed to support the infrastructure of holiday resorts have been forced to sleep in inhumane conditions, on balconies, in vehicles and garages and have paid over-the-odds for the dubious privilege of doing so.
The Government is, undoubtedly, also concerned about lost tax revenue from undeclared rental, but it has to be agreed that a system of regulation is needed to protect both holidaymakers and proprietors. Increased demand for accommodation in the Balearics has made foreign investment in rental property very attractive, but it has never been so essential to seek legal advice and the assistance of a reputable agent or property management company. Registration of a tourist establishment requires declaration of income for tax and the submission of personal information to local authorities. Homeowners are also responsible for passing on the passport or NIE information of every guest over the age of 16 years to the Policia Nacional as well as for the collection and payment of the Balearic Tourist Tax on behalf of the Government.
Under new laws the restrictions on holiday rental and cost of licenses increased sharply from 1st July this year. Apartments can be let under a standard tenancy agreement provided no services are offered and the property is not promoted as a tourism rental. Ibiza has enjoyed a record number of visitors so far this year, and its popularity is expected to continue in an upward trend. Given that there are always insufficient hotel beds in July and August it is not in the interest of the authorities to discourage private rental, so, provided that property investors have everything in place, and comply with all relevant legislation, this is still the time to get the best of returns from a property in any price range.
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