British holidaymakers to Spain are likely to have a more costly stay following the rise in Spanish VAT announced yesterday – although the increases are not as steep as some tour operators had feared.
The Spanish Prime Minister Mariano Rajoy announced that general VAT – including items such as clothing and cigarettes – would be raised from 18 per Cent to 21 percent to combat the country’s mounting economic difficulties.
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VAT for the leisure industry, which is at a reduced rate, will increase from eight per cent to 10 per cent, covering accommodation, Food and drink at restaurants, hotels and bars, as well as processed food.
Visitors booking hotels independently may find the tax Rise is added to their bill for stays after August 1 this year.
A family that spent £1000 on an independent hotel stay, as well as food and drink, would find £20 added to their costs, without taking the purchase of more highly taxed general items into consideration.
However, those who have already booked package holidays this year will not find the cost of their break is affected, the Association of British Travel Agents (ABTA) confirmed - although prices are likely to rise in the future. The only impact on those visitors will be on the ground, on items not included in the holiday price.
Read the full article at The Telegraph
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