By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

A yacht broker has urged this nation to "beef up brand Bahamas" by cutting charter fees for vessels that register under this country's flag, as he asserted: "Everybody wins."

Travis Delva, director of yacht services at Windermere Yacht Services, told a maritime industry seminar discussing legal reforms accompanying the 2025-2026 Budget that such incentives could spark "a domino effect" where both the private sector and government earn more revenue by driving vessels to The Bahamas yacht registry.

He argued that driving more business to this nation, as opposed to the Government seeking all its revenue upfront via the new 14 percent charter fee that incorporates the former VAT, would likely be more profitable for all while enabling the Public Treasury to earn more tax income at the back end from the increased economic activity.

Speaking after Bahamas Maritime Authority (BMA) officials confirmed their desire to grow The Bahamas' existing yacht registry, Mr Delva backed their call to drive increased registrations through offering foreign-flagged charter vessels incentives such as reduced charter fees.

"I think in general that we should be trying to encourage foreign-flagged charters, vessels that are chartering in Bahamian waters, to register under The Bahamas flag," he agreed. "And so I think we should try to look at some incentives or some concessions to encourage these yachts to re-flag Bahamian, whether it be a reduction in the charter tax or whatever.

"This is just as a suggestion, of course. We want to beef up brand Bahamas... So right now, our company, we register vessels in The Bahamas, and one of the questions they always ask is what are the advantages. So if we want to really create a strong position for those advantages, I think starting with encouraging them to flag Bahamian and giving them a reason to would be a great start."

Lonna Bethel, the Port Department's assistant controller, who was leading the call, said she could "make no promises" on whether the suggestion for tax breaks and other incentives to grow The Bahamas' yacht registry. And she pointed out that there is "a very tight window" of two weeks before the Budget and accompanying legislation must pass ahead of the new fiscal year's July 1 start.

"Even if it means a differentiation of the charter fee?" she asked. "I can't make no promises, you all, but we do have the right people on this call, so I will be doing a lot of sidebar conversations after this to see how we can best utilise our very tight window that we have; a very tight window."

When one attendee suggested cutting the 14 percent foreign yacht charter fee rate, which will be implemented come July 1, 2025, to 12 percent or 11 percent for vessels that choose to register under the Bahamian flag, she replied: "Hold on. Wait now. Whoa, whoa, whoa. One thing at a time you all."

Mr Delva then added: "To help you to pass it on to the policymakers, if the current tax is 14 percent straight across-the-board, if a Bahamian-flagged vessel comes into play, and we know that based on the ultimate beneficial owner they still have to obtain a charter licence because the vessel is still perceived as foreign-owned, because it is not owned by a Bahamian or is not owned by a Bahamian company that is owned by a Bahamian, I think we need to offer them some type of concession.

"Whether that be going from 14 percent to 10 percent for a Bahamian flag specifically because, again, you're going to have the balance on the other side. The BMA will now be gaining more revenue because we have more Bahamian-flagged vessels coming to the register, and it's a ricochet effect from that, a domino effect."

"Everybody wins," ventured Ms Bethel. "Everybody wins," replied Mr Delva, "because local agents like myself, they're going to approach us. Imagine, 'how do I flag vessel as Bahamian?' So now we, as the tax-paying businesses who pay the Business Licence fees and so on and so forth, will now be gaining more revenue.

"We're also VAT registrants. That's more tax revenue for the Government through VAT, and so it's just again a domino effect that would be a positive outcome straight across-the-board versus trying to seek all that revenue from the 14 percent when we know folks like to evade taxes as much as possible.

"So if we can encourage then to do this, I think it will work for the Port Department, it will work for the Government in generating more revenue. It will impact local businesses by increasing their income and growing their clientele and expanding their services."

Stephen Keenan, the London-based BMA's senior deputy director in its inspections and surveys department, had initially suggested offering tax breaks for vessels that register under The Bahamas' flag as a critical incentive to help build and grow a yacht registry.

"One of the ways we think we might be able to do that is if we can offer an advantage to a Bahamian flagged yacht rather than a foreign-flagged yacht," he explained, "so that's why we were wondering if it's possible that these fees do not apply to Bahamas-flagged yachts or are reduced in some way? It might give us an advantage, it may not, but if we don't try it.....

"We've made a policy decision as well that, after July 1, we will no longer register private yachts of less than 20 metres in length. The ones that are already registered are fine. They'll stay with us, but we won't accept anything under 20 metres as of July 1."