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Money & costs



Spain is, as locals will quickly tell you, not as cheap as it once was. What you spend on accommodation (probably your single greatest expense) will depend on various factors, such as location (Madrid is pricier than Murcia), season (August along the coast is packed and expensive), the degree of comfort you require and a little dumb luck. At the budget end you’ll pay €12 to €23 for a bed in a youth hostel (depending on the hostel, season and your age).

The cheapest bearable pensión (small private hotel) /hostal (budget hotel) is unlikely to cost less than €18/30, but reckon on more in the cities and resorts. Depending on where you are, you can stumble across good rooms with attached bathroom from as little as €30/45 (up to €60/80 in the more popular locations).

Eating out is still more variable. A menú del día (daily set menu) can cost as little as €7 to €12. Bank on spending a minimum of €20 on a full dinner (including house wine).

Most sights are fairly cheap. Keep an eye out for free days (especially on Sunday and set days for EU citizens).

Public transport is reasonably priced, although high-speed trains are pricey.

A backpacker sticking to youth hostels, lunchtime snacks and travelling slowly could scrape by on €40 to €50 a day. A more comfortable midrange budget, including a sandwich for lunch, a modest evening meal, a couple of sights and travel will be anything from €100 to €150 a day. From there, the sky’s the limit. It is possible to spend hundreds on five-star lodgings and even in the occasional gourmet paradise.

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The law requires menu prices to include a service charge; tipping is a matter of choice. Most people leave some small change if they’re satisfied: 5% is normally fine and 10% generous. Porters will generally be happy with €1. Taxi drivers don’t have to be tipped, but a little rounding up won’t go amiss.

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As in 12 other EU nations, the euro is Spain’s currency. The euro is divided into 100 cents. Coin denominations are one, two, five, 10, 20 and 50 cents, €1 and €2. The notes are €5, €10, €20, €50, €100, €200 and €500.

Spain’s international airports have bank branches, ATMs and exchange offices. They’re less frequent at road crossings now as Spain’s neighbours – Andorra, Portugal and France – all use the euro. If you’re coming from Morocco, get rid of any dirham before you leave.

Banks and building societies tend to offer the best exchange rates, and are plentiful: even small villages often have at least one. They mostly open from about 8.30am to 2pm Monday to Friday. Some also open Thursday evening (about 4pm to 7pm) or Saturday morning (9am to 1pm). Ask about commissions before changing (especially in exchange bureaux).

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Many credit and debit cards (Visa and MasterCard are the most widely accepted) can be used for withdrawing money from cajeros automáticos (automatic telling machines). This is handy because many banks do not offer an over-the-counter-cash advance service on foreign cards (and where they do, the process can be wearisome). The exchange rate used for credit and debit card transactions is usually more in your favour than that for cash exchanges. Bear in mind, however, the costs involved. There is usually a charge (hovering around 1.5% to 2%) on ATM cash withdrawals abroad. This charge will appear on your statements.

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There is little advantage in bringing foreign cash into Spain. True, exchange commissions are often lower than for travellers cheques, but the danger of losing the lot far outweighs such gains.

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As well as at banks, you can exchange both cash and travellers cheques at exchange offices – usually indicated by the word cambio (exchange). They abound in tourist resorts and other places that attract high numbers of foreigners. Generally they offer longer opening hours and quicker service than banks, but worse exchange rates. Their commissions are, on occasion, outrageous.

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Taxes & refunds

In Spain, value-added tax (VAT) is known as IVA (ee-ba; impuesto sobre el valor añadido). On accommodation and restaurant prices, it’s 7% and is often included in quoted prices. On retail goods and car hire, IVA is 16%. To ask ‘Is IVA included?’, say ‘¿Está incluido el IVA?’.

Visitors are entitled to a refund of the 16% IVA on purchases costing more than €90.16 from any shop if they are taking them out of the EU within three months. Ask the shop for a cash back (or similar) refund form showing the price and IVA paid for each item, and identifying the vendor and purchaser. Then present the refund form to the customs booth for IVA refunds at the airport, port or border from which you leave the EU. This works best at airports, where you will need your passport and a boarding card that shows you are leaving the EU. The officer will stamp the invoice and you hand it in at a specified bank at the departure point for immediate reimbursement. Otherwise you will have to send the forms off from your home country and have the amount credited to your credit card.

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Travellers cheques

Travellers cheques usually bring only a slightly better exchange rate than cash, usually offset by the charges for buying them in the first place.

The advantage, of course, is that they protect your money because they can be replaced if lost or stolen. Visa, Amex and Travelex are widely accepted brands with (usually) efficient replacement policies. Amex offices will cash Amex travellers cheques commission-free – but you should always compare exchange rates with those offered in banks. Remember to take along your passport when you cash travellers cheques.

Get most of your cheques in fairly large denominations (the equivalent of €100 or more) to save on any per-cheque commission charges.

If you lose your Amex cheques, call a 24-hour freephone number (900 994426). For Visa cheques call 900 948973; for MasterCard cheques call 900 948971. It’s vital to keep your initial receipt, and a record of your cheque numbers and the ones you have used, separate from the cheques themselves.

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