BY NATARIO McKENZIE
Tribune Business Reporter
THE Bahamas could “kiss the yacht charter business goodbye” if the Government decides to levy a 15 per cent Value-Added Tax (VAT) on the industry, the Marina Operators president yesterday urging: “We really need to get this settled.”
“Obviously it’s caused a lot of uncertainty in the industry,” said Peter Maury, president of the Marina Operators of the Bahamas (MOB).
Referring to the Miami International Boat Show last month, Mr Maury said there was still significant interest in this destination within the boating community, although the uncertainty regarding VAT’s impact on the industry was impacting bookings.
Mr Maury said the MOB was still seeking a meeting with the Ministry of Finance for greater clarification on VAT’s likely impact on the industry. Following an MOB meeting and VAT presentation last month, marina operators had urged the Government to pursue the largely uncollected 4 per cent Charter Fee levied against foreign yacht,s and potentially exempt their sector from 15 per cent VAT, warning that the uncertainty was already “steering” business away from the Bahamas.
“They are already booking for the late 2014 season and the 2015 season, and they are not booking in the Bahamas because they are worried about paying 15 per cent on their charter fees. We already charge a 4 per cent fee,” said Mr Maury yesterday.
“Other Caribbean countries charge zero. If we go to 15 per cent we could kiss the industry goodbye; they are not going to come here.”
Mr Maury added that the trickle down economic effect from the charter industry was considerable. “It’s not like they just go to a marina and pay the marina. With the the yacht industry they are buying everything from fuel to groceries to liquor; they employ boat cleaners to IT people to mechanics,” he added.
“It’s really a broad spectrum that’s covered in this industry. It’s not like a guest that goes and spends time at a hotel. These guests touch all the islands of the Bahamas, in most cases.
“Typically, a large yacht will spend a three months in the Bahamas and go all over the place. This is why it’s so important for us to understand this industry and educate the brokers and agents handling these yachts, so that when they book charters here they know what the fees are. By not giving them the information we have just shot ourselves in the foot basically. It’s very unfortunate.”