Tourist tax to promote rentals of low-emission vehicles

Abstract

In the Canary Islands (Spain), the tourism boom has been paralleled by sharp growth in the car rental sector. However, this economic activity is associated with problems such as rising levels of vehicle emissions. In this article, we discuss, on the one hand, the introduction of a tax to internalise the costs of emissions from car rental fleets and, on the other, the measures to reward users who rent environmentally-friendly cars. For this purpose, we propose a model based on statistical decision theory, from which a Bayesian rule is derived. According to this model, the tax increases with the number of days the car is rented but decreases in line with the environmental efficiency of the vehicle. A data sample of visitors to the Canary Islands is used to compare the covariates involved in computing the number of car rental days and the corresponding tax payable.

Skewed Binary Regression to Study Rental Cars by Tourists in the Canary Islands

“…This result is similar to those of Palmer-Tous et al (2007) and Aguiló et al (2017) who explain that the accommodation days increases the daily expenditure transport at the destination. In addition, long vacation periods also increase the probability of renting a car for more days (Thrane andFarstad 2011 andGómez-Déniz et al 2020). According to the results, tourists with hotel accommodation are unwilling to move around the island, decreasing the likelihood of renting a car.…”

“…According to the results, tourists with hotel accommodation are unwilling to move around the island, decreasing the likelihood of renting a car. Palmer-Tous et al (2007) and Gómez-Déniz et al (2020) show that tourists who frequently rent cars are those who do not stay in hotels. Furthermore, tourists who lodge in hotels spend fewer nights at their destination than those who choose other types of accommodation (Alegre and Pou 2006).…”

“…However, this paper has focused only on the probability of renting cars; no aspects concerning sustainability have been considered. In this sense, in line with the environmental efficiency, Gómez-Déniz et al (2020) propose to promote low emission car rental in tourist destinations.…”

“…The Canarian Regional Federation of importers and car dealers collected in their annual report that the car rental sector turnover was around 520M euros in 2017, increasing 6% concerning 2016. The Finance Department of the Canary government received through the General Indirect Canary Tax (IGIC) around 49M euros (Gómez-Déniz et al 2020).…”

Bimodal length of stay in the accommodation sharing economy

“…This distribution, therefore, is appropriate for modeling length of stay. A detailed study of this model can be seen in Gómez-Déniz et al (2021) .…”