By Annelia Nixon

Tribune Business Reporter

anixon@tribunemedia.net

Marinas and yacht brokers yesterday blamed tax hikes and especially the addition of 10 percent VAT to foreign yacht charter fees for a drop-off in business in recent years.

Alexander Dorsett, R. H. Curry and Company’s port and ship agent, said: “We’re hoping to get a little bit more, not really clientele, but a little bit more integration into what we’re noticing smaller vessels coming into The Bahamas are looking for because we have seen a decline in some of the larger boats coming in.”

Speaking at the third Bahamas Charter Yacht Show, he added: “So we’re trying to expand our yacht portfolio so we’d be able to handle large and small vessels. There’s a couple of reasons for it. I’ve been doing this now, this is my seventh year as a yacht and shipping agent. Definitely, we’ve seen an increase of taxation.

“So you end up paying 10 percent back on your charter fee, which some of the yachts I’ve worked for before, to charter them for a week, you’re looking at a $1m. So if you’re having to spend 10 percent VAT on that, and then you also have to go and spend 4 percent on top of that [in Port Department fees], you’re talking what? $140,000 [in taxes]?

“I can’t remember exactly what the fee was, but we would pay the charter tax through the Port office and it would be nowhere near that amount of money. Nowhere near. But it all depends on the vessel; how much they charge for their charters and how everything is set through the agencies.”

Romora Bay Resort and Marina also said it has experienced a decline in business volumes and suggested the combined 14 percent tax rate created by the combined VAT and Port Departments may be too much.

“I’m looking forward to going on the yachts and meeting new captains and staff members, “ Lorria Whitfield, marina manager at Romora Bay Resort and Marina, said. “And the captains on the yachts, they play a big role because they’re the ones that choose the marina. Some of the listings that I saw here, a few of them I know and then there’s some new ones. So I also want to get to know the new ones as well.

“For right now I’m operating a marina that runs off of chartered boats. There has been a decrease in revenue and in numbers for boats that have been coming to our marina. I can speak for Romora Bay Resort and Marina.

“We have also mentioned it to the Ministry of Tourism along with the board of the Marina Association, just inquiring as to basically if it’s the 14 percent - the increase - that has caused the decrease or if it’s the cost as in like food cost, fuel cost, hotels like for Harbour Island. We have both resorts and houses, private houses. So we’re also trying to figure out whether or not it’s the cost or actually the 14 percent that has caused a downgrade on the yacht and charter boats.”

Christopher Langille, membership director for Legendary Marina Resort at Blue Water Cay which is under construction on southern New Providence, said marinas are trying to “figure out what the right balance is” to retain business.

“As a marina developer, we’re members of the Association of Bahamian Marinas, ABM, and they are trying to figure out what the right balance is for that,” Mr Langille said. “At some number it is a right balance. At some number, perhaps not.

“So there’s a point at which people go to other countries, and there’s a point at which they bring them here and the Bahamian government enjoys the revenues from that. And they need to, because if they’re using Bahamian waters, there should be some tax there.

“But 14 percent seems to be a bit of a challenge for a lot of the industry. And they’re exercising their option to go other places, which is not what any of us want. And we want them to stay right here. So that’s what the Association of Bahamian Marinas is trying to hang on to - the business here, and to build the business here and to have the boating world, the charter world included, emanate from here. Instead of people run to other countries. I mean, they do have other choices, but to me, The Bahamas is the best choice.”