The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Private aviation was yesterday said to have been “blindsided” by Customs fee increases due to take effect today that will result in the sector paying more than a Boeing commercial jet airliner.

Rick Gardner, a Bahamas Flying Ambassador and director of CST Flight Services, which provides flight co-ordination and trip support services to the private aviation industry, told Tribune Business that himself, other private pilots and the wider tourism industry appeared to be “the last to know” of the changes to fees set out in the Customs regulations.

The Customs Management (Amendment) Regulations 2024, which come into effect today to coincide with the Budget’s passage and start of the 2024-2025 fiscal year, change the aircraft inbound and outbound fee structure such that it appears a private plane with more than four seats will pay three times’ what a regularly scheduled commercial jet does.

Under the new fee structure, commercial jets will have to pay a $50 “inbound” and $50 “outbound” fee for a total of $100. However, a private plane with four seats or less “including all seats in the cabin” is now faced with paying $75 each way for a total of $150.

That is slightly more than the $100 fee for a commercial jet, but private aircraft with more than four seats “including all seats in the cabin” now face having to pay $150 “inbound” and “outbound” fees to Customs for a total $300. So-called “recreational” flights will only pay $150 “inbound”, but cargo flights will see a $150 fee levied on both “inbound” and “outbound” trips involving The Bahamas.

Mr Gardner explained that, for private planes and private aviation, the fee increases represent a three-fold and six-fold increase, respectively, on the previous Customs fee structure which was $50 “inbound” and zero “outbound”. Besides being taken unaware by the fee increases, he added that uncertainty surrounds how they will be applied because no “guidance” notes have been released.

“Nobody seems to know,” he told this newspaper. “There was no guidance given on how this is going to be applied. There’s no real guidance on how they’re going to define these categories, both Customs and the new fees at Bimini airport. They’re vague.

“At this point, I don’t know what to tell you. A Boeing 737 with 180 passengers is going to pay $50 in and $50 out. How do you explain that to a guy with a six-seater plane who is going to pay triple what a Boeing 737 or Boeing 787, what any commercial jet, any airline, is going to pay?”

The inbound/outbound fee increases associated with aircraft declarations tie-in with the Government’s Budget position that certain fees were to be increased to cover the costs associated with providing public services. They also align with the Davis administration’s policy, unveiled in the 2023-2024 Budget, of seeking to increase fees on foreign visitors to The Bahamas while minimising those on Bahamians.

The Government likely perceives the private pilot/aviation industry as having deep pockets, viewing private plane ownership and use as a sign of wealth, and able to easily absorb the fee increases laid out in the Customs Management (Amendment) Regulations 2024. They also include a $2,500 fee that will be levied if an aircraft declaration is submitted less than one hour before the plane arrives in The Bahamas.

However, Mr Gardner described the private aviation market as “fickle”. He warned that, if pilots and their guests feel The Bahamas is trying to take advantage of or exploit them with fee increases, they have the ability to fly to other Caribbean destinations based on “the principle not the monetary value”.

“When you raise the bar on complexity and fees, fewer people are willing to jump over it,” he told Tribune Business. “Me personally, I think it’s going to have a negative effect, and the biggest losers will be the people who earn a living from tourism.

“It’s not only the monetary value. It’s when they feel they are being taken advantage of. They are fickle. It’s the principle. All I can tell you is that when you increase the complexity, you increase the fees in any industry, it’s never good.

“Don’t kill the goose that lays the golden egg. Make it easy for the goose to come and lay more eggs. Every time you increase complexity and cost, nothing good comes of it. We have to look beyond the airport. We cannot be myopic. We have to look at the whole picture,” Mr Gardner continued.

“It’s the ripple effect when a plane lands at a destination. You inhibit that. You inhibit the distribution of money.” That, he added, has a negative impact throughout the tourism industry value chain on hotels., restaurants, ground transportation providers, tour operators and others involved in the sector.

Mr Gardner said some private pilots would opt to incur greater fuel costs by flying to destinations such as the Dominican Republic and Turks & Caicos if they feel The Bahamas is targeting them simply because they are perceived as wealthy or taking advantage of them.

Revealing that he is due to give a presentation on the benefits and attractions of flying to The Bahamas at Air Venture Oshkosh, a major aviation show that will be held towards the end of this month and attracts around 650,000 people, he added that “we’re going to have to be upfront and say this is what’s going on” with the fees to land and take-off in this nation.

Affirming that much depends on how Customs interprets and assesses the fees, especially how it applies the recreational definition, Mr Gardner said: “I cannot in good conscience look a fellow pilot in the eye. The airlines are going to pay $50 in, $50 out, and in the best of cases you are going to pay $150 total. How do I look someone in the eye and say that?”

“I don’t know how many times we’ve been blindsided like this.. if we keep being the very last ones to find out. It is what it is. We do this [Flying Ambassador] for free, and what’s at stake is our reputation. I will have to behave accordingly.

“If we had notice, if we had discussions three months ago, I could talk about it and develop a strategy for presenting it to the industry. You do it in a collaborative manner where you are all on the same side of the table. Here it is; we’re not going to get blindsided by it,” he added.

“I cannot really tell them [private pilots] what it’s going to cost. We know what the least of the options are, and we know what the worst of the options are. Plan for the worst and hope for the best. This is like the third, the fourth, the fifth time [of being blindsided]. It is what it is.”

Kerry Fountain, the Bahama Out Island Promotion Board’s executive director, yesterday agreed that the Customs fee increases for private aviation “is a concern” said he needed to do more research on the likely impact before commenting further.