The business section of your newspaper on August 9, had an article on Carlton Russell’s views on the need to tax the vacation home rental market. I’m not surprised by Russell’s thoughts as he is the president of the Bahamas Hotel and Tourism Association (BHTA) which, I’m sure, would love to see the vacation home market taxed to oblivion.
Russell noted this rental market “needs to carry the load”.
In my humble opinion, this market is already heavily taxed and carrying more than its fair share of the load. All homes rented have been constructed by Bahamians using materials, furnishings and fittings that have been charged duty and/or VAT.
Unlike the hotels for which Russell sings his songs, all homes in The Bahamas over a certain value, pay real property tax. It is my understanding that hotels do not pay real property tax for many years from the date of their completion.
Russell also complained that a great percentage of airline seats are being “eaten up” by Airbnb. Isn’t it wonderful that these seats are being “eaten up” by tourists wanting to come to The Bahamas?
The benefits to the Bahamian economy generated by the vacation rental market are immense and the taxes going to government are significant.
My family and I recently rented two vacation homes on Great Exuma for a week. We had four rental cars and ate lunch at local restaurants every day. We purchased our food and drinks from local stores and did all the touristy things and paid the costs associated. My grandchildren swam with the pigs, the stingrays and the turtles. We would not have gone to Exuma if we had to stay in a hotel, guest house or a heavily-taxed vacation home.
On the same page in The Guardian as your report on Russell’s pleas is a headline, “PM urges Family Islanders to take advantage of the rental market”.
The article which followed showed the prime minister’s belief that the vacation rental market will continue to grow, especially in the Family Islands. The prime minister, the deputy prime minister and the minister of tourism are, I hope, too smart to kill the geese laying the golden eggs by burdening this price-sensitive market with additional taxes.
– John A. Wanklyn