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FOOD & DRINK

Will Spain soon no longer be the land of cheap alcohol?

As the EU pushes a revised common framework for higher tax on cigarettes and alcohol, Spain could see drinks prices rising.

Will Spain soon no longer be the land of cheap alcohol?
Alcohol is still relatively well priced in Spain compared to other European countries, but it's getting more expensive. (Photo by JAIME REINA / AFP)

A glass of (cheap) wine and some (free) tapas. This simple combination is a part of the atmosphere that attracts so many people and tourists to move to or at least spend a few days in Spain – and it might be about to end soon.

The European Union is looking to increase taxes on beer, wine, and other alcoholic beverages as the minimum rates to be applied by all member states have not been revised since 1992.

The rates “have not kept pace with inflation, the evolution of the market, consumption patterns or growing public health concerns”, the EU commission said.

Currently, Spain exercises one of the lowest duties in Europe, collecting just about € 2.69 per 700ml liquor bottle. Germany collects € 3.65, France € 5.05, and Italy € 2.90, as a comparison.

READ ALSO: What’s cheaper about life in Spain than in other countries?

When it comes to beer, the country taxes € 0.03 per 33cl, well below the European average of 14 cents, according to the EU Commission database.

It makes for some famously cheap alcoholic drinks – and the Spanish cities and islands’ bars and restaurants indeed thrive from the business such an offer can draw.

However, Spain could collect some € 1bn in taxes yearly if it applied similar rates as its neighbouring European countries, Diario de Navarra reports.

READ ALSO: 13 mistakes tourists in Spain are bound to make

Spain’s collection of excise duties accounted for only 0.29 per cent of its total tax revenues in 2019. However, the EU average is 0.79 per cent.

The country is also famous for its “happy hour” deals, with free tapas or two for one drinks sometimes lasting much longer than an hour, making it really the land of cheap alcoholic beverages.

Calls from the health sector

Besides increasing tax collection, Spanish authorities also have to weigh complaints and growing calls for higher taxes from health sector representatives – those looking to reduce consumption by ending the rule of the cheap alcohol in Spain.

For years, health associations in Spain have issued alerts on the connections between alcohol and health problems, with children and adolescents particularly vulnerable in Spain.

While tobacco use has decreased over the years, the “prevalence of drunkenness”, meaning the percentage of teenagers who say they “often” get drunk, is above the European average, at 17 per cent in Spain, according to a 2019 EU study.

To prevent alcohol abuse, several medical institutions and associations in Spain have been asking for a price increase in alcoholic beverages and even an increase in the minimum age for consumption in the country.

READ ALSO: Ten facts you probably didn’t know about Spanish wine

Spanish teenagers can legally start alcohol consumption at 14 years, and the Spanish Society of Family and Community Medicine (SEMFYC) is asking for the government to increase that age to 18.

SEMFYC also points out that an excise tax should be used to increase the price of alcoholic beverages and reduce their accessibility either through taxes or by setting a “minimum price”.

The organisation strongly defends that there is no proof that a “moderate consumption” of alcohol brings benefits, questioning the idea that the one glass of wine a day, a staple of some versions of the healthy Mediterranean diet, is actually good for people’s health.

Will my wine get more expensive, then?

In the short term, no, but the difference in tax collection compared to other EU countries is weighing on Spanish authorities – a yearly € 1bn in the collection is not something to be ignored.

Even if the government doesn’t make a move first, the European Union has launched a public call for feedback on its framework governing excise duty rates for alcohol. It will stay open until July 4th.

It favours higher taxes, if not to respond to galloping cost of living prices in the continent, as a way to adapt to growing public health concerns. EU processes can take long, and their adoption by member states still longer, but there may come a time when Spain will no longer be the land of cheap alcohol.

READ ALSO: Ten things NEVER to do when dining in Spain

Traditions can adapt and evolve, and as long as the tapas and lively environment remain more or less the same, happy hour can continue to be just as happy.

Member comments

  1. I’m curious why the article doesn’t include the reduction in tourist traffic and money added to the economy when sharing the upside of a billion euros in additional taxes. This won’t come for free as the article shares many go on holiday to Spain for these reasons. As far as raising taxes to deter younger people from drinking? That hasn’t worked anywhere in the world and that is with alcohol pricing significantly higher than it is in Spain. I am not a fan of the EU directing cultural constraints on countries, the EU was a trading block for economic purposes and now its purely a 4th level of government only, and when has that EVER added value.

  2. I agree & maybe it’s just me but instinctively I rile at the notion of a body of authoritarian figures dictating my every move. Most people are responsible enough to know what they should and shouldn’t do & regulating what people can and cannot eat or drink won’t deter those who don’t. Why fix it if it’s not broken & as the previous poster has stated people come to Spain not just for the sea and sun but for the cheaper prices. This model has served Spain very well & I hope they don’t lose sight of the fact that there are plenty of cheap alternatives to head for if prices become unattractively high.

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TOURISM

EXPLAINED: The new alcohol rules for tourists in Spain’s Balearic Islands

Mallorca and Ibiza are well known to many as booze tourism destinations but after new legislation was introduced in 2020, it's only now that the crackdown on excessive drinking by holidaymakers is being enforced.

EXPLAINED: The new alcohol rules for tourists in Spain's Balearic Islands

The Balearic Islands, made up of Mallorca, Menorca, Ibiza, and Formentera, are well known not only for their beautiful coastal resorts but also their booze tourism spots.

Long famous for cheap drinks, pub crawls, and booze cruises, tourists from across Europe have descended on the islands for cheap drunken fun for decades.

Yet new rules cracking down on excessive drinking and disorderly behaviour on the islands are making that harder, with authorities attempting to change the Balearics’ image and model of tourism.

The rule changes came into effect in January 2020 but owing to the total shutdown of international travel and tourism during the first two years of the Covid-19 pandemic, its impacts are only being felt now.

On the islands of Mallorca and Ibiza, the crackdowns are focused on the popular tourist areas of Magaluf, El Arenal and Sant Antoni that are synonymous with drunken revelry and boozy getaways.

The new rules

  • Legislation means that 2-for-1, happy hour, and free bar offers are now banned. Advertising of these kinds of cheap boozy deals are also prohibited in the hotspots.

  • The sale of alcohol in shops has been scaled back as they are now forced to close between 9:30 p.m. and 8:00 a.m.

  • The rule changes ban the granting of new licenses for booze cruise style ‘party boats’ and the limiting of alcoholic beverages to six per day in all-inclusive hotels.

  • The infamous tourist practice of ‘balconing’ – when drunken tourists launch themselves from balconies into swimming pools – has also been banned and will, according to the official government bulletin released in 2020, “expel with immediate effect” those partaking in the popular and often lethal activity. 

  • Restaurants and bars that serve food are also limited in how much alcohol they can serve, in addition to all-inclusive resorts. The new rules state the maximum per lunch or dinner is three alcoholic beverages. 

READ MORE: Spanish islands crackdown on booze tourism model

  • A favourite of many British tourists, pubcrawls, have also been banned, with fines handed out to establishments advertising their bars or restaurants as part of boozy routes through the islands. According to the official bulletin, “the advertising, organisation, sale and realisation of the so-called routes (pub crawling) is prohibited, where the objective is the tour of different venues in which drinks of alcoholic beverages are included continuously and on the same day.”

Establishments that don’t follow the rules will face hefty fines, according to the legislation. The government texts outlines fines of between €1,000 and €600,000, plus the possibility of shutting down offending establishments for up to three years.

Tourists queue to take part in a boat party on Figueretes Beach in Ibiza. (Photo by JAIME REINA / AFP)

Feeling the effects

Many tourists arriving in the Mediterranean islands in 2022 are unaware of the new changes.

Easyjet is warning all its potential customers flying to Sant Antoni of the new crackdown, and the British press is also publishing stories of disgruntled tourists unhappy they can’t go on pubcrawls and are limited in how many drinks they can order in hotels and restaurants. 

The Balearic government say it is the first legislation in Europe to ban the sale and advertising of alcohol in specific tourist areas. Yet because the island’s economy – much like the Spanish economy more broadly, of which tourism makes up a sizeable 13% chunk of GDP – is so dependent on tourists, and welcomes over 13 million of them every year, it will have to strike a balance between the revenue that comes from booze tourism and realising its aims of ‘sustainable tourism’.

English holidaymakers in Magaluf having drinks while watching Euro 2020. The holiday spot is popular among young European revellers, most of them British. (Photo by JAIME REINA / AFP)

READ MORE: 13 mistakes in Spain tourists are bound to make

It is unclear if other tourist hotspots in Spain, such as the Costa Blanca and Costa del Sol, will follow similar models and try to shift away from being the default destination for cheap, boozy getaways. The changes in the Balearics come amid broader debate in Spain about the role and model of tourism, and how it aligns with the Spanish economy as it heads into the first non-COVID summer season and tries to recover from the pandemic. 

Freed from COVID-19 restrictions it may be, the Spanish tourism sector – or more specifically, the tourists coming to enjoy it – now face newer, self-imposed restrictions aimed at rebranding its imagine and moving away from its long-held booze tourism model.

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