NO MORE FREE-FOR-ALL?: Govt considering regulation of vacation rentals & yacht charters market

NO MORE FREE-FOR-ALL?: Govt considering regulation of vacation rentals & yacht charters market
(FILE)

High demand for vacation rental properties has reportedly led to housing shortage on Exuma

“We welcome our friends from different countries, but fair is fair; we need our share to help build the roads, the dock and bridges”

NASSAU, BAHAMAS — The Davis administration intends to look more closely at the vacation rental market marketplace throughout the country and implement a registration and inspection system, according to Deputy Prime Minister Chester Cooper.

Cooper, the minister of tourism, investments and aviation, while addressing the 15th annual Exuma Business Outlook conference yesterday, said: “We plan to have registration and inspection of vacation rental properties for the safety of our guests and the protection of our product and our destination.” 

Chester Cooper.

Cooper noted that while it will ultimately be a Cabinet decision, he will recommend that value-added tax (VAT) be levied on vacation rentals.

“As it stands, hotels pay taxes and vacation rental homes don’t. Frankly, in my view, many of these homes are owned by non-residents — whom we welcome and love, but many of them don’t live here in Exuma on a full-time basis. Many of them are competing with hotels, sometimes with the benefit of the government’s marketing, infrastructural spend and sometimes with concessions,” said Cooper who noted that the country receives very little in the end.

Cooper said the Davis administration also plans to look at regulating activities such as car rental businesses and boat rentals. 

Former Prime Minister Dr Hubert Minnis, during a budget communication back in May, said that the government was amending the law to clarify that all vacation home marketplaces, such as AirBnB and VRBO, are required to pay VAT on rentals and commissions.

Cooper noted yesterday that the high demand for AirBnBs on Exuma has led to a housing shortage, which he said provides an economic opportunity.

He also said that many Bahamian entrepreneurs often complain about unfair foreign competition.

“We welcome our friends from different countries, but fair is fair. We need our share to help build the roads, the dock and bridges we all complain about,” said Cooper.

Cooper said the government is also looking to extract more from the yacht charter business, stating that it is “unconscionable” that a cruising permit is $300 and the charter fee is four percent of the charter cost. 

“There has to be equity. We recognize there is economic impact of their arrivals, but we must balance what we do as a country to ensure we maximize that potential,” said Cooper, suggesting that this nation is only touching the “tip of the iceberg” at present.

“There is great potential in the cruise and charter market.”