Royal Caribbean Notifies Guests of Unexpected Increase

Royal Caribbean began notifying guests booked on cruises to the Bahamas that they can expect to see changes in their port charges, if their departure date is on or after January 1, 2024. New tax rates will take effect that day, after the Bahamian government approved the new policy in June.

Tax Increase Amounts Will Vary By Itinerary

Royal Caribbean issued a “Bahamas Tax Update” to booked guests, explaining that the Bahamas is implementing changes to its departure tax amounts for all cruise guests visiting the destination.

Royal Caribbean says the tax amount will change from $1 to $14, depending on the itinerary length. The update advises each guest that the line will be updating their reservation with the new amount.

It adds that adjusted taxes and fees will reflect on the booking before the final payment due date, and displays the adjusted tax amounts that the guest must pay.

“Bookings are being updated in phases based on the sailing date. There is nothing for you to do, we just wanted to keep you informed. We realize this is an unexpected charge and apologize for any inconvenience,” Royal Caribbean’s notice to guests says.

Earlier this week, Royal Caribbean sister line Celebrity Cruises sent out similar notices to its booked guests, advising them of the new tax rates. Other cruise lines with ships calling at the ports of Nassau, Freeport, and Bimini, and at the lines’ various private islands in the Bahamas, are likely to follow suit.

In Celebrity Cruises’ case, guests are reporting variations in the new fees being levied, with some seeing increases of just a few cents or dollars, while others are incurring higher costs.

The tax hikes vary widely due to several factors, including the number of ports a ship will visit in the Bahamas during one itinerary, whether a private island will be visited, and how long a ship will remain in port.

Port charges are always subject to change, since the cruise lines publish itineraries, fares, and fees months and sometimes years ahead of departure date.

How The New Tax Structure Works

The tax increases and the introduction of two new taxes were announced by the Bahamas in June and are contained in the country’s Passenger Tax Amendment Bill 2023.

Under the new structure, the current $18 per passenger departure tax will rise to $23 for guests whose ships leave from Nassau, Freeport, and Bimini. The increase rises to $25 per passenger for those whose ships depart the country from a private island without calling at another Bahamas port.

This tax change would affect many cruisers, since all of the major cruise lines operate private islands in the Bahamas, and itineraries sometimes bypass the main ports. On short cruises, a private island may be the only port call on an itinerary.

Besides the departure tax changes, the bill created a $5 tourism environment tax and a $2 tourism enhancement tax on all cruisers arriving or departing the destination. All of the tax hikes originally were to take effect on July 1, 2023, while the new environment and tourism enhancement taxes were to begin on January 1, 2024.

However, the Bahamian government, in late June, just days before the new levies were to begin, decided to postpone the departure tax increases to next year, meaning that all of the tax hikes and the two new taxes will be charged starting January 1, 2024.

With the new cruise tax structure in place, the Bahamian government projects $145 million in annual revenue, up from $50 million expected in the current fiscal year.

Bahamas One of Busiest Ports

The cruise industry delivers millions of travelers to the Bahamas each year, with the country’s biggest port located in its capital, Nassau. The port, which in May 2023 unveiled Phase 1 of its multi-year redevelopment plan, can accommodate six cruise ships simultaneously, including three Icon or Oasis-class ships.

Nassau set a cruise passenger record in February 2023, welcoming 28,554 guests in one day. Port officials expect that 4 million cruise guests will transit through Nassau this year.