In the last month, we have seen a coordination of the hospitality sector to demand responsibility for the partial and total closures that have been promoted by the different regional administrations in Spain. Your goal is none other than make a partner in the administration of the losses caused and that they are compensated by aid.
There are many complaints, for example, the SOS Hostelería platform that represents 35,000 existing hotel establishments in the Valencian Community, asks the Generalitat Valenciana for several measures to alleviate the situation.
The measures are aimed at trying to alleviate the cost structure of the sector. We have the suspension of the payment of the last quarter of personal income tax corresponding to 2020, the suspension of the payment of the last quarter of VAT, the suspension of all municipal taxes and fees in 2021 until the pandemic is ended and economic activity does not recover its total normality, the suspension of payments for basic services of the hospitality establishments such as water, electricity and gas, with the ICO and the Institut Valencià de Finances taking over the payment of these bills and the suspension of any regulations that negatively affect the sector of the hospitality industry, such as the Law of the Game.
But these demands had fallen on deaf ears. Thus, judicial means have been sought, that is, to sue the State and the Autonomous Communities. This month, thanks to the LaHosteleríaDeTodos.org platform, which integrates restaurants, bars, cafes and taverns, the first 50 lawsuits have been filed against the Ministry of Industry, Commerce and Tourism.
Even from the employers’ association represented by Hostelería de España, it would be studying to find the protection of the courts to lift the closures and restrictions in the sector, following the decision of the Superior Court of Justice of the Basque Country to proceed with its opening.
All that pressure seems to have worked. Yesterday we learned how the Government has given its arm to twist and, a year after the start of the State of Alarm, it has been announced a package of aid for companies, SMEs and the self-employed quantified at 11,000 million euros that the Executive is expected to approve in the following weeks.
From the hospitality industry, in the absence of knowing the fine print, it is claimed that these aid are direct and lost funds through a combination of lower taxes and subsidies.
Aid at European level
The sector problem has been exacerbated by ongoing sector-specific partial or full closures. ** A fixation that has attacked the revenue side without any compensation **. Although in the initial phase of the crisis the problem was linked to trying to reduce costs, obtain liquidity for financing and ERTE, now, the problem is already survival itself. Solvency is the big concern.
curiously European countries have had much greater regard for this sector. Although the restriction measures may be aligned, there is a notable difference in the final treatment granted. Generally, direct aid has been used to bear the burden of fixed costs.
The most generous aid would come from Germany, which is the advantage of having healthy public accounts before the pandemic. In this case, the hospitality industry could receive an amount of up to 200,000 euros depending on the size of the company and up to 90% of the fixed costs depending on the losses. To this, given the administrative decentralization of Germany, we must add the aid of the federal states. If we remember, last year a reduction in VAT was brought about that would remain at 7% for bars and restaurants until 2022.
From France, they have contributed aid quantified up to 10,000 euros per month for companies with less than 50 workers that have suffered losses that have reached 70%. If the drop in turnover is 50%, the monthly aid is 1,500 euros. To this, the expansion of the space to install the terraces is added and the losses of the businesses are compensated with aid equivalent to the ERTE for the employees
The Italian Government helps restaurants in 29 tourist areas with a maximum of 20% of income that they have lost. This help comes from the comparison of current billing with the same period of the previous year.
Then we have governments that contribute fixed amounts. Luxembourg is offering € 20,000 per month for micro-businesses, € 100,000 per month for SMEs and € 200,000 for large companies. Belgium supports with 3,000 euros to the hoteliers and the Netherlands allocates more than 2,500 euros in lost fund per month to the sector.
Losses for the sector
The hospitality sector must be taken into account because it is vital for the Spanish economy. Their numbers offer a total of 300,000 establishments that employ 1.7 million people and it has a sales volume of 123,612 million euros, with a contribution of 6.2% to the GDP of the Spanish economy. In detail, restaurants, bars, cafes and pubs employ 1.3 million people and have a turnover of close to 94,000 million euros, contributing 4.7% to the national GDP.
And 2020 was a year of great losses for the sector. It points to a 50% drop in turnover which has had an impact of 70,000 million euros. For this reason, the sector has seen how they had announced the definitive closure of 85,000 bars and restaurants. The labor market linked to the sector has suffered especially because currently 360,000 workers are in a situation of ERTE.
In no case, in all this time, has the Spanish Government had the consideration of emulating its European partners for the granting of specific aid for the sector. A situation that would be marked by considering that there are greater needs to be addressed through the budget and a starting financial situation of growing imbalance in public finances.
With the European funds allocatedIt seems that there is a financial margin but the 11,000 million plan is pending details. The Government has not communicated anything relevant about this measureSimply, President Sánchez has transferred that they would be destined to reinforce the solvency of the balance sheets, resume the activity and hire workers.