The Tribune

By ANNELIA NIXON

Tribune Business Reporter

anixon@tribunemedia.net

YACHT charter operators are again urging the Government to revisit taxes and fees, warning that the cost of such levies is driving vessels to competing destinations and inflicting a greater blow than soaring fuel prices.

Michael Dillon, owner of Abaco Yacht and Charter Services, said the Government must focus on making The Bahamas more attractive to visiting boaters rather than focusing on just fuel costs, arguing that the 14 percent foreign yacht charter fee plus the new cruising permit structure introduced last year continue to undermine demand and the wider marine tourism industry.

“I’ll be honest with you, the fuel costs aren’t nearly the impact on us that we had from the decisions the Government made last year with fees, the cruising permit fees and all that,” Mr Dillon said. “That structure is still convoluted, and it’s still having a negative impact today.” The Davis administration, in response to complaints about 2025-2026 Budget boating fee hikes, sought to address these by creating two new cruising permit categories this year.

Mr Dillon said operators have also been forced to contend with higher fuel costs, which are affecting charter bookings and profitability. However, he argued that the more pressing concern is the loss of business to destinations where boaters face lower charges.

“You don’t make more when you charge more,” he said. “You run people off. You got to find middle ground where you can get your pricing, where it’s going to attract people.”

Mr Dillon said the Government should compare the cost of boating in The Bahamas with rival destinations, particularly the British Virgin Islands (BVI) and the US Virgin Islands, where he said fees are significantly lower.

“Find out what boats are paying for the same services that we have here in The Bahamas; find out what they’re paying down in BVI and the US Virgin Islands,” he said. “They’re significantly less money. And guess what’s happening? People are taking their boats there.”

Mr Dillon argued that policymakers have failed to adequately consult marine industry stakeholders before implementing charges, warning that the decisions are being made without a full understanding of the costs associated with operating a vessel.

“They don’t know anything about yachting,” he said. “They don’t know what it costs to put fuel on a boat. They don’t know what it costs to put crew on a boat. They don’t know what it costs to put provisions on a boat. They don’t know what it costs to take care of the boat. They don’t know any of that stuff. None of it.”

Mr Dillon said visiting boaters are particularly sensitive to the overall cost of cruising, and that excessive charges can damage The Bahamas’ reputation as a destination even when the country offers attractive waters and proximity to the US.

“And then you go on and start whacking everybody with fees and, trust me, the people that are on the boats, they know what it costs,” he said. “And when they saw them fees, you know, the first thought they had was: The Bahamas is ripping me off — again.”

Stephen Kappeler, managing director of Bimini Big Game Club Resort and Marina, previously said larger vessels were still largely absent from Bahamian waters, arguing that the Government’s failure to adequately adjust charges was deterring some of the country’s highest-spending visitors.

Mr Kappeler said the absence of boats longer than 60 feet was hurting businesses beyond marinas because yacht owners and their guests spend money on fuel, groceries, restaurants and other services as they travel between the islands.

He estimated that private boaters can spend up to $400 per day on land, compared with about $30 for a cruise ship passenger, and argued that the Government was penalising visitors who contribute substantially to the wider tourism economy.

Meanwhile, Kerry Fountain, executive director of the Bahama Out Island Promotion Board, previously attributed a 6.4 percent year-over-year decline in sea arrivals to Abaco through July 2026 to the impact of the boating fee increases.

The Government has since revised elements of the fee structure, introducing the two new cruising permit categories covering stays of 30 days or less and six months or less. The changes reduced costs for some visiting vessels, particularly those staying for shorter periods, while also clarifying that anchorage fees apply to pleasure vessels that are not docked in marinas.

However, Mr Dillon maintained that the broader pricing issue requires further attention if The Bahamas is to recover lost boating business. He also criticised the country’s fuel costs, pointing to what he described as a substantial disparity between prices in Florida and The Bahamas before the conflict involving Iran began.

“Before this Iran war started, people in Florida were paying $2 a gallon for gas,” he said.

“In The Bahamas, we were still paying $5. Why? It does not cost that much more to get the gas to The Bahamas than it does to Florida. It does not.”

Mr Dillon argued that taxation and fuel company margins were contributing to the price burden facing Bahamian businesses and consumers, but insisted that fuel should not overshadow the industry’s concerns about boating fees.

For his own charter operation, he said higher fuel prices have resulted in cancellations, additional surcharges and fewer bookings, directly affecting the company’s bottom line.

“We’ve definitely had people cancel because of the cost of fuel,” Mr Dillon said. “I know it’s definitely hitting our bottom line because we have charters where fuel is included. So we’ve had to put surcharges on the charters to cover the fuel cost. We have fewer bookings, too, because the fuel cost is so high.”

Fuel in Abaco is selling at about $7.80 per gallon, he said, adding that prices in Nassau do not fully reflect the burden faced by businesses operating in the Family Islands.

“It’s like $7.80 something,” Mr Dillon said of the price in Abaco.

“If you’re in Nassau, you have no idea. You guys are living cheap.”

Despite those pressures, Mr Dillon said restoring the flow of visiting vessels should be the industry’s primary concern, arguing that the economic benefits of attracting boaters extend across multiple sectors.

“You guys talking about the fuel prices. I’m sorry, it’s the wrong conversation to have,” he said. “The conversation to have is getting the boats back here.”