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Operational Costs For Cruise Lines Fixed Through June 2004

Passenger Taxes, Incentives To Be Negotiated With Ports Authority, Tourism Co


September 4, 2003
Copyright © 2003 CARIBBEAN BUSINESS. All Rights Reserved.

Cruise lines serving the island have some breathing room. The Puerto Rico Ports Authority has acknowledged its agreement to provide cruise lines with incentives and not to increase their operational costs through June 30, 2004.

All bets are off after that date, however. The members of the Florida-Caribbean Cruise Association, which represents 13 cruise lines operating 100 vessels in Florida, the Caribbean, and Mexican waters, had hoped the incentives would be extended until 2008.

The Ports Authority intends to increase fees for cruise passengers coming to the island in January 2004. "The Ports Authority is open to feedback from industry leaders about the plan to increase fees," said Jose Suarez, executive director of the Puerto Rico Tourism Co and a board member of the Ports Authority.

The Ports Authority says it must raise fees on cruise ships and freight because of the enormous costs associated with enhanced security measures taken after 9/11. It proposes raising the head tax on every passenger arriving or departing the island from the current $10.30 to $15.50 by 2005. The agency collects about $12 million a year in fees on cruise passengers; the new rate would raise the figure to $18.8 million.

The Tourism Co. plans to alter the incentive package it offers cruise lines. The government charges an average head tax of $10.30, but the agency gives cruise lines a $3 per-passenger rebate for every 120,000 passengers.

"The incentives were effective at helping the industry after 9/11," Suarez said. "Now we [at the Tourism Co.] are trying to redesign the package to make it more attractive for Puerto Rico."

This Caribbean Business article appears courtesy of Casiano Communications.
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