In 2025, Marbella’s Hospitality and Leisure Properties Face a 10% Increase in the IBI Tax
Marbella Town Hall has announced plans to increase its IBI property tax by ten percent for owners of leisure and hospitality establishments. The move is expected to generate an additional 2.1 million euros in 2025. This marks the first planned increase for the upcoming fiscal year, ahead of the development of next year’s budget. The proposal is set to be approved on Thursday, 19 September, during an extraordinary council meeting.
Hotel Businesses to Bear the Brunt of the IBI Tax Increase in Marbella
According to sources within the town hall, the tax increase will primarily impact hotel businesses. The new measure introduces a fifth paragraph to Article 8 of Marbella’s regulatory tax bylaw. This paragraph establishes a differentiated rate of taxation for urban properties classified as “G. Leisure, hotel, and catering”. The new rate of one percent will be applied to properties valued above 377,000 euros.
Limitations and Implementation of the New IBI Tax Marbella Rate
The document issued by Marbella’s economic administrative court, following a council meeting on 19 August, states that the new IBI tax rate will be applied to a maximum of 10 percent of the properties in the municipality with the highest cadastral value. The new measure will take effect on 1 January 2025, before the next IBI property tax bill is due.
Past Measures in IBI Tax Marbella’s Policy
This new measure echoes a similar one approved in September 2023, which saw an increase in the IBI for commercial premises with a cadastral value of more than 1.5 million euros. At the time, town hall spokesman Félix Romero explained that Marbella was facing a “judicial tsunami” following the Supreme Court’s decision to extend the statute of limitations period for legal cases against the town hall from five to 15 years, after the Gil party’s term in office.
How Will the 10% IBI Tax Increase Affect Marbella’s Hospitality Sector?
The 10% IBI (Impuesto sobre Bienes Inmuebles) tax increase in Marbella is set to have a significant impact on the hospitality sector, which is already grappling with economic fluctuations and the aftermath of the COVID-19 pandemic. The IBI tax, essentially a property tax in Spain, is levied on the ownership of real estate, and the increase will affect both business owners and landlords who rent out their properties to hospitality businesses.
For hoteliers, restaurateurs, and bar owners, the tax hike could lead to an increase in operational costs. Property owners may choose to pass on the additional tax burden to their tenants through higher rents. This could result in a rise in overhead expenses for hospitality businesses, potentially squeezing profit margins. In a sector where margins are often tight, this could force business owners to make difficult decisions, such as cutting costs, reducing staff hours, or even increasing prices for consumers.
The increase in consumer prices could have a knock-on effect on tourism, which is a cornerstone of Marbella’s economy. If hotels and restaurants become more expensive, tourists may seek more affordable destinations, which could lead to a decrease in visitor numbers. This would not only affect individual businesses but could also have broader economic implications for the region.
Moreover, the hospitality sector is known for its seasonal fluctuations, with businesses relying heavily on the high season to sustain them throughout the year. The increased IBI tax could make it more challenging for these businesses to build the necessary financial reserves to weather the low season.
On the other hand, the tax increase is expected to generate additional revenue for the local government, which could be reinvested into public services and infrastructure. This could, in turn, enhance the overall attractiveness of Marbella as a tourist destination. However, the immediate concern for many in the hospitality sector is whether the short-term impact of the tax increase could undermine the long-term benefits of such investments.
In response to the tax hike, industry associations and business owners may lobby for support measures, such as tax relief or incentives to help mitigate the impact on the sector. The local government may also need to consider introducing measures to support the hospitality industry, such as promotional campaigns to attract tourists or financial aid for businesses most affected by the tax increase.
In conclusion, the 10% IBI tax increase in Marbella presents a complex challenge for the hospitality sector. While it may contribute to improved public services in the long run, the immediate effects could place additional strain on an industry that is vital to the local economy. Stakeholders will need to engage in dialogue and collaborate to find solutions that balance the need for tax revenue with the sustainability of the hospitality sector.
