Introduction

Tourism is Bermudas largest industry, with the largest percentage of people coming from the USA. In total around half a million tourist visit Bermuda each year.

Some of these are aboard cruise ships, however although the number of cruises worldwide has greatly increased, with many new ships, in recent years the numbers visiting Bermuda has fallen.

Customer viewpoints

It would appear that the Bermuda government wants passengers to go by cruise ship one way and fly the other, while most passengers prefer to cruise both ways.

Bermuda is also far more expensive (Arrivals tax) a destination than other options, the current rates compared with other options are:-

They were considering raising it to $80, but protests caused a change of action. This is a far more visible tax than other forms and has to be paid directly by visitors as opposed to being part of the package.

In addition to this there are fees paid by cruise ships, which have to be added into the ticket prices, these are $14 per passenger per night May to August and $10 per night the rest of the year. 

Overall 2001 showed a 14% drop is cruise ship passengers, air arrivals down by 16%, hotel guests down by 19% and overall down by 21%. 

One problem that cruise ships have is that having visited Bermuda, they don't really have anywhere else they can go, compared with Caribbean cruises that call on a series of islands. Looking at the list of cruise ships and where they came from it is particularly noticeable that the vast majority, if not all, come from the USA east coast. 

Solutions

Reducing arrivals tax

Reducing the arrivals tax to line up with other destinations would make marketing sense, but would mean the government of Bermuda have to find the income from other sources or cut expenditure, both likely to be unpopular.

Currently they have the worst of all  situations high tax, and numbers dropping, causing loss of tax revenue.

Many of the business community on Bermuda will recognize the downward spiral and  tax increases to keep the coffers full, as this will only destroy more trade. 

New kingdom.

Once the new kingdom is in existence, in addition to the existing round trip traffic from the USA, there will be through route cruising via Bermuda the new kingdom and Azores to Europe and the return leg. This is a lot more attractive to clients, opening up a large number of new possibilities as well as an alternative to flying to Europe and touring by that means.

It may be that they look on the new revenue produced and new clients as a windfall, and with full hotels etc, there may be a tendency to do that. If they are wise however they will realize that the opportunity that this gives them, is for government income to be maintained and at the the same time arrivals tax reduced, so that other forms of tourism also can recover and a better long term business environment can be built.

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Last updated: October 09, 2002.