The monthly renting of cars in Spain is going to become more expensive due to a fiscal measure included in the General State Budget for this year. A measure promoted by the Government coalition that affects the price of car insurance and that came into effect on January 1, 2021.
Do you have a rental car or are you thinking of betting on this alternative to the traditional purchase of a new car? We bring bad news. He the amount of the monthly car rental fee in Spain is going to go up. The price rise will vary depending on various factors, for example, if it is a passenger car or an industrial vehicle. Now, why is this increase in price? Let’s go into details.
One of the fiscal measures included in the PGE (General State Budgets) for this year 2021 and that came into effect on January 1 includes the insurance tax increase from 6% to 8%. A change that applies to auto policies, regardless of when they started, and that they make quota payments as of that date.
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The compulsory insurance of vehicles registered by the rental companies is affected by the aforementioned modification. Therefore, the amount of monthly installments will be recalculated to transfer the tax increase carried out by the Spanish Government to the end customer.
How much will the price of renting my car go up? Is this climb legal?
A priori it is possible to think that, if the renting contract has already been signed and we have in our garage the vehicle for which we are paying a fee every month, there is no margin for said price increase. However, Renting companies reserve the right to raise the quota based on the so-called “Coverage Service”, that is, car insurance. Therefore, this price increase will affect all customers, both current and future.
Taking into account this determining factor, it is time to go into details and analyze how much the rental cars are going to get more expensive. Although it depends on each specific case, it is possible to get an idea of the impact of this tax measure. The insurance of a tourism will rise between € 0.54 and € 0.63 per month, or what is the same, between € 6.5 and € 7.5 per year. For its part, the insurance of an industrial vehicle will be more expensive between € 0.70 and € 0.80 per month, which translates into an increase of between € 8.50 and € 9.50 per year.
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The main renting companies that operate in Spain are already getting in touch with their clients to inform them of this situation. This is an important thrust for a market that in recent years has seen a real gold mine in the private channel. More and more private drivers are opting for renting instead of opting for the traditional purchase of a new car.
Factors such as economic uncertainty and doubts as to what types of technologies will be “rewarded or punished” in this process of transition towards sustainable mobility that the Old Continent is experiencing means that many drivers do not want to link to a vehicle for many years. In 2020, car registrations made by renting companies in Spain reached 209,272 units, which represented a drop of 30.91% compared to 2019 data.