The Tribune

By NEIL HARTNELL 

Tribune Business Editor 

nhartnell@tribunemedia.net

CUSTOMS’ top official yesterday conceded not all officers were initially “on the same page” over newly-implemented aviation fee increases which may not be “a shut case”.

Ralph Munroe, the Customs comptroller, told Tribune Business that the agency has swiftly tackled the “different treatment” that some pilots and operators have encountered at separate ports of entry over fee rises implemented on July 1, 2024.

He added that the “misunderstandings” cut both ways with some private pilots unsure of the aircraft category they fell into and, as a result, what fees are applicable to them. Voicing confidence that industry concerns will be eased and addressed, Mr Munroe said the Government will always listen and make adjustments to the charges if the general aviation sector can make the case.

The Customs comptroller, though would not be drawn on the rationale for why the fees were increased; the magnitude of the hikes; the extra revenue that will be raised; and private pilot claims that they were blindsided and not consulted over the rises, saying they were either policy-level decisions or not his and the agency’s responsibility.

“I think there are a number of issues there,” Mr Munroe told this newspaper of the initial backlash over the fee increases. “Some of the pilots were not too sure which category they fell into; whether they fell into commercial whether they fell into recreational or whether they fell into charter.

“There were a few persons who engage in private commercial charters in The Bahamas as well who, in some cases, were being wrongly classified. That was one issue. There was also a misunderstanding as to whether they would be paying to land on the inbound. That was cleared up. There is a one-time payment” for both the inbound and outbound fees being levied by Customs to clear and exit The Bahamas.

The uncertainty, though, was not confined to private pilots and charter operators. “Some of the officers were not fully clear on it themselves,” Mr Munroe disclosed. “As soon as it came to our attention, we discussed it and sorted it out in the first week.

“Sometimes it’s a misunderstanding on the part of the officers. There was a case where the operator was being treated one way at a particular port of entry and, in another island, was being treated in another way. We had to call that island and say ‘no, this is how they are to be treated’. We had some simple cases like that where not everyone was on the same page.”

The Customs comptroller then echoed Dr Kenneth Romer, the Government’s aviation director, in signalling that the newly- increased Customs fees are not set in stone and that the Government is open to talks with private pilots and the general aviation industry on the matter.

“I believe they’ve started some discussions. I don’t know if it’s a shut case, so to speak,” Mr Munroe told Tribune Business. Asked if he was surprised at both the push back to the increases and the extent, he replied: “No and yes. Any time you have an increase in any fees Customs has to implement, there’s always somebody who’s a stakeholder that will have a response.

“People don’t like increases, that’s number one. Secondly, I think there are a number of persons who don’t fully understand where they fall in all this; the categories they fall into. At the end of the day, they’ll have it all worked out. Two to three years ago we had a similar situation where persons were justifiably concerned, but it was all worked out.

“I think there’s going to be some discussions. If there’s a need for adjustment of the fees, the Government will look at that... I’m sure they’ll get it worked out. You sometimes have to look at things again and, if there is some justification, they will make the change if you bring the case. The pilots are reasonable people. I’m sure they’ll work it out.”

Mr Munroe said Customs officers are present at The Bahamas’ booth at the ongoing EAA AirVenture Oshkosh fly-in, one of the world’s largest private aviation events currently taking place in the US, which attracts more than 600,000 people and 10,000 airplanes each year.

He added that the officers would be meeting with private pilots over several days to address any questions they may have on visiting The Bahamas. “I’m sure it’s going to be clear from that perspective and they will get the message out to all their members,” Mr Munroe said.

A Bahamian aviation entrepreneur, meanwhile, added his voice to the concerns expressed by visiting pilots as he warned that the aviation industry must be “nurtured and not taken for granted” or overlooked.

Paul Aranha, founder of Trans-Island Airways, told Tribune Business that while successive administrations have increasingly focused on attracting greater commercial airlift to The Bahamas in the belief this sector brings in more tourists they ignore private aviation at their peril. He added that one ultra high net worth individual brought in by private plane could outspend all passengers on a commercial jet combined.

“It’s something we need to be very cautious about,” he warned of the fee hikes. “If you look at the yachting industry and what happened when the taxes increased there they moved on to other destinations. It could be very similar for the aviation.

“It’s a lot more sensitive and a lot more diverse than just a family flying into The Bahamas. Aviation is very important for the life-blood of our country... It’s an industry that needs to be nurtured and not taken for granted.”

Besides distributing high-spending tourists to the more far-flung Family Islands that are off the beaten track for commercial visitors, Mr Aranha said private pilots and general aviation also provide extra connectivity for the locals living in those locations. The sector also helps to transport workers from Nassau to the Out Islands to effect critical infrastructure repairs much more quickly.

“It’s a critical element of responding to natural disasters,” the Trans-Island Airways chief said of private aviation. “When we had disasters like hurricanes Joaquin, Matthew or Dorian, it’s the private planes that are instantly the first ones to spring into action to help.

“We want these pilots to feel welcome in our country because when it comes time to help us we don’t want them to feel alienated when we need them to help. Often the industry is overlooked, and what we’ve seen with successive governments is they view the larger commercial airlines as the lifeblood because they deliver hundreds of thousands of passengers per year.

“But don’t overlook the small planes that bring in ultra-high net worth individuals because some of them could outspend an entire airliner.” One private pilot estimated The Bahamas could lose between “50,000-100,000 flights per year right now because of the fees” being increased.

Private planes brought 323,000 air arrivals, or one out of every six higher-spending stopover visitors, to this nation in 2023. Some 95,000 of that number came from Florida alone and, giving an insight into what is at stake, the total was more than combined visitor numbers from Canada, Europe and Latin America.

The Customs Management (Amendment) Regulations 2024 changed the aircraft inbound and outbound fee structure such that it appears a private plane with more than four seats now pays three times’ what a regularly scheduled commercial jet does.

Under the new fee structure, commercial jets 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.

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”.