The Spanish motoring organization Automovilitas Europeos Asociados (AEA) states in its analysis that in the village of Escorca in Mallorca in 2025 they registered 3960 passenger cars. However, only 199 residents officially live there. There is a similar situation in La Hiruela in the Madrid region, TASR writes according to the Majorca Daily Bulletin website.
- In Escorca, Majorca, they register 3960 cars with only 199 inhabitants.
- Different motor vehicle tax rates create significant tax incentives.
The analysis attributes this to significant differences between the lowest and highest motor vehicle tax rates within Spain. It is calculated for cars based on engine power, engine capacity for motorcycles and for trucks and buses based on weight and number of seats. Local councils have the legal power to reduce the minimum rate and offer a discount of up to 75 per cent depending on fuel and engine characteristics. Some vehicles can be completely exempted from paying the tax.
“The authority of councils has distorted the purpose of the local tax system,” AEA analysis states that Escorca is a prime example of a tax haven. Car rental and leasing companies therefore register cars in small villages with favorable conditions. “Every year, these municipalities earn revenue from vehicles that do not drive there and will never drive,” explains the AEA.
The study gives as an example several municipalities in the north-west of the Madrid region, as well as Finestrat in Alicante and Tejeda in Gran Canaria. Up to 35 percent of company vehicles in Spain (244,921 out of a total of 694,559) are registered in these municipalities with a population of between 600 and 15,000.
In 25 Spanish municipalities, for example, there are on average more registered vehicles per inhabitant than in the United States or Japan. For example, La Hiruela in the Madrid region, with only 88 inhabitants, has an average of 69 vehicles per inhabitant.
