The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

A private pilot yesterday branded the Government’s new aviation taxes “flat out the wrong way to go”, having himself cancelled three trips in the past two months, costing this economy some $6,000.

Describing private pilots as a small, tight-knit group, Michael Penman said some had simply decided to stop flying to the Bahamas, describing the new and increased taxes as “the straw that broke the camel’s back”.

“What will really get hurt is the Out Islands, as that’s where folks like to go – Treasure Cay, Marsh Harbour,” Mr Penman told Tribune Business. “The monies we spend on actually landing in the Bahamas are a lot smaller than what we spend in the economy.

“I think it [the aviation taxes] will take time to roll through the system, and I think you will see less and less guys flying there. We do love the islands. I personally think everyone’s doing a good job in the Out Islands in making everyone feel welcome, but the Government is trying to get money the wrong way.

“An extra $2,000-$3,000 at the weekend is a fair chunk of change for the Family Islands, and it could get evenly spread through the community.”

And analyzing the annual impact of his lost business, Mr Penman added: “The Bahamas are awesome, but decisions to keep taxing and taxing whilst still requiring us to spend tourist dollars is double dipping.

“My $25,000 per year I spend in the Bahamas went to Jackson Hole last week as I took my family there instead……. What folks don’t realise is that it is not the money, it’s the principle.

“Politicians have made a very, very bad decision in this case. It will cost the islands dearly and hurt the folks who provide those services. What surprises me is that every single person in the tourist industry was not up in arms over this new fee.”

Mr Penman’s case illustrates just how badly the Bahamas could be impacted if other private pilots react in similar fashion to the new fees. Others have already predicted that it could cost the Bahamas, and its tourism industry, up to $16-$20 million in lost annual revenues.

In an e-mailed letter to the Government, Mr Penman said the new $25 per head departure fee introduced in the 2013-2014 Budget meant he was collectively paying $150 per head for his six-seater aircraft.

Private pilots and their passengers are also being hit with a $50 charge for processing their Customs declaration form, while Mr Penman added that aviation gasoline was more expensive in the Bahamas than the US.

“When you factor in all the charges as well as the cost to stay, eat and enjoy, as well as the hassle of Customs both into the Bahamas and then back into the US, folks like me simply don’t go near as often as we used to,” Mr Penman told the Government.

“Being in South Florida I can visit the keys, west coast of Florida, South Carolina islands and so forth for about half the cost of a Bahamas trip. Our normal costs in the islands for a three-day visit are about $400 a night for rooms (we have four kids), $200 a night for food, about $60 per day for boat, $50 per day for golf cart. That’s about $710 in revenue per night from a pilot like myself, or $2,100 per visit spent on the island. All the other ‘fees’ are not included in the above.”

And he added: “I’ve already cancelled three trips so far in the past two months, and simply went to local places here in Florida because it was much less hassle and cost. That’s about $6,000 in actual dollars getting pumped into the local economy (Abacos is our favourite) that is just not happening. I think that decision-making needs to be long-term and it needs to take into account total lost revenue, not just the small ‘fee’ gain that you are seeing because nobody is aware of it yet.”

Giving a personal insight into the potential loss for the Bahamian economy and tourism industry as a result of the new aviation taxes, Mr Penman said: “Our next trip is going to be to the Dominican Republic, simply because they don’t charge to enter the country.

“The place is apparently beautiful, no landing fees, 10 cents a day to park and cheap gas. This information is spread around the pilot community very quickly, and after a short period, that’s where the pilots go, just like I am doing.

“I think that you should revisit these fees to encourage folks like me, who are already having a hard enough time continuing to fly (it’s really expensive, and we aren’t all super rich]) to visit the islands on a regular basis.

“I’m sure that these fees are hitting the Out Islands the hardest, where there is little commercial traffic and it’s mainly private aircraft/boats that visit. I’m sure that if we made it easier on the boaters/pilots, and I’m not just talking fees but also protocol, that good news will spread and more travellers will be inclined to visit the islands.”

Mr Penman told Tribune Business yesterday that he had reduced his ‘flying visits’ to the Bahamas from once a month to once every two-three months. “In Key West I don’t have to worry about finding $200 extra dollars,” he added. “I can spend it on night life, eating, entertainment.

“It’s the Family Islands, especially the outer ones that will take the brunt of it. The ones the pilots like to visit will get most of the burden.”

Suggesting that the new taxes would hurt short-stay visitors brought in by private aviation the most, Mr Penman also urged the Government to make it easier for visiting pilots to file their US inbound and outbound eApis declarations from the Family Islands.

These declarations are essential for planes to be cleared to return to the US, and obtain clearance security numbers. Mr Penman said the hassle associated with this had also put some pilots off from visiting the Bahamas, and he suggested this nation provide the means for them to file electronically.

“In years past I would often visit an island for the afternoon with a friend to introduce them to flying, the Bahamas and just to be social,” he added. “The implementation of the eAPIS system has effectively ruled out the ‘let’s quickly grab a sandwich in Nassau’ trip.”