The Government of the Bahamas is proposing departure tax hikes for cruise passengers along with two new tax levies, all in a bid to substantially raise annual revenues from travelers who visit the destination by cruise ship.
If all of the planned actions move forward, the government will boost yearly revenues from cruise ship guests to about $145 million, up from the current $50 million.
Most Fees Could Take Effect in July 2023
A plan by the Bahamas government seeks to nearly triple the country’s annual revenues from cruise ship guests visiting either of the destination’s main ports, Nassau and Freeport, with some charges proposed to take effect next month, according to The Tribune, based in Nassau.
The changes are detailed in the Passenger Tax Amendment Bill 2023, which is slated to be included in the government’s fiscal budget.
The Bahamas currently levies an $18 per passenger departure tax, and that tax would rise by about 27%, to $23, for guests whose ships leave from Nassau and Freeport.
The tax would increase by about 38%, rising to $25 per passenger, for those who depart the country by sea from a private island, without calling at another port in the country.
The higher fee would affect many cruisers, since all of the major cruise lines operate private islands in the Bahamas, and itineraries frequently will bypass the two main ports.
Additionally, the bill creates a $5 tourism environment tax and a $2 tourism enhancement tax on cruisers arriving or departing the destination. All told, each cruiser leaving from Nassau and Freeport would be charged $30, while those leaving from a private island would pay $32.
As proposed in the bill, all but the tourism enhancement tax would take effect on July 1; the enhancement levy would follow on January 1, 2024.
None of the cruise lines have commented publicly on the proposals yet, and industry watchers believe that the major cruise trade groups are privately discussing the bill with Bahamian officials.
Popular Nassau Port Recently Upgraded
The Bahamas is a wildly popular cruise destination visited by virtually every major cruise line. The Nassau Cruise Port recently set a new cruise passenger record, when more than 28,000 cruise guests from several lines visited on one day in February 2023.
The port also recently emerged from a massive upgrade that took four years and cost $300 million. Work included the addition of a new berth and the refurbishing and repairing of all piers.
With the renovations, Nassau Cruise Port can now accommodate six cruise ships per day, including three Icon or Oasis-class ships.
The expansion of the port increases its capacity from 20,000 cruise passengers per day to over 30,000 cruise passengers per day. The port expects to welcome a total of 4 million cruise guests in 2023.
Cruise Line Investment in Bahamas Keeps Growing
Several of the major cruise lines also have made, or are in the process of making, significant investments in the Bahamas. Disney Cruise Line, for instance, recently announced the opening of its new island destination at Lighthouse Point, Eleuthera, in The Bahamas, set to debut in the summer of 2024.
Plans for the 700-acre beach retreat were announced in 2019, and the project represents an investment by the cruise line of up to $400 million. The cruise line already has a private island in the Bahamas, Castaway Cay.
Royal Caribbean also has big plans for a new destination in Nassau and is working with the Bahamian government to bring it to fruition.
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The luxury-level Royal Beach Club at Paradise Island will be a public-private partnership that enables Bahamians to own up to 49% equity in the project, and local businesses will manage most of the guest experiences.
The plan received government approval in March 2023, and the beach club is slated to open in 2025.