Taxes and fees differ for the same cruise and category based on rate class?

[MisterBill99]

Here's a strange one, even for me. I am looking at booking a sailing on Royal, the TA I checked had a group rate of $432 and "Taxes and fees" (not port charges) of $217.  Fine, but they show several rates for the same cabin category (senior, resident, non-refundable deposit, brochure, etc.), and non-group fares had taxes and fees of $186. I asked the TA about it, and she told me that the taxes/fees are set when the group is booked and do not change. And it's lower for the higher fares, so it's not some percentage based on the fare.

 

Even stranger, I posted a request for quotes at a site and got prices that had the $432 price and taxes/fees of $159.31. Also found that pricing on a different TA site.

 

I've always considered myself pretty savvy about cruise pricing, but this one has me stumped (and the TA's just say "yeah, that's how it is"). How can the same cruise and category have different taxes/fees depending on what rate you pick?

Edited June 27, 2022 by MisterBill99

[navybankerteacher]

2 hours ago, MisterBill99 said:

Here's a strange one, even for me. I am looking at booking a sailing on Royal, the TA I checked had a group rate of $432 and "Taxes and fees" (not port charges) of $217.  Fine, but they show several rates for the same cabin category (senior, resident, non-refundable deposit, brochure, etc.), and non-group fares had taxes and fees of $186. I asked the TA about it, and she told me that the taxes/fees are set when the group is booked and do not change. And it's lower for the higher fares, so it's not some percentage based on the fare.

 

Even stranger, I posted a request for quotes at a site and got prices that had the $432 price and taxes/fees of $159.31. Also found that pricing on a different TA site.

 

I've always considered myself pretty savvy about cruise pricing, but this one has me stumped (and the TA's just say "yeah, that's how it is"). How can the same cruise and category have different taxes/fees depending on what rate you pick?

Most taxes are not “one size fits all” - but are based on a variable.  Sales taxes are based upon the amount paid for the thing - not its inherent value. So a pair of shoes costing $50 would carry a sales tax of $3 if there were a 6% sales tax - but if sold on sale at $40 the sales tax would be $2.40  —- at  the same tax rate —- on an identical pair of shoes.  Other taxes and fees (in particular) vary pursuant to a number of conditions.
 

 But, as you say, “...depending on the rate you pick...” the taxes and fees will obviously vary - because “...depending on what rate you pick...” the quality and identity of the product does not automatically determine the rate - rather it is the deal you select that governs — not simply the “... cruise and category...”.

 

Fees, of course, are going to be whatever the seller says they are going to be - and can be pretty much arbitrarily assigned based upon whatever formula the seller wants to apply, in connection with whatever type of sale it is.

Edited June 27, 2022 by navybankerteacher

[MisterBill99]

11 minutes ago, navybankerteacher said:

Most taxes are not “one size fits all” - but are based on a variable.  Sales taxes are based upon the amount paid for the thing - not its inherent value. So a pair of shoes costing $50 would carry a sales tax of $3 if there were a 6% sales tax - but if sold on sale at $40 the sales tax would be $2.40  —- at  the same tax rate —- on an identical pair of shoes.  Other taxes and fees (in particular) vary pursuant to a number of conditions.

 

But you missed the point. The tax on a $40 pair of shoes is going to be less than the tax on a $50 pair of shoes. In this case, the tax on a $432 fare has higher taxes than a $644 fare. And here's a snippet of the fares, including showing that different $644 fares have different fees! 

 

 

Edited June 27, 2022 by MisterBill99

[chengkp75]

Look at the fares from Royal themselves.  The "taxes and fees" category from travel agents very often include the "non-commissionable fare" as a "fee", so that they can offer a lower base fare (the commissionable portion).  While the cruise lines are regulated as to what can be included in the "port taxes and fees", travel agents are not.

[navybankerteacher]

1 hour ago, MisterBill99 said:

 

But you missed the point. The tax on a $40 pair of shoes is going to be less than the tax on a $50 pair of shoes. In this case, the tax on a $432 fare has higher taxes than a $644 fare. And here's a snippet of the fares, including showing that different $644 fares have different fees! 

 

 

The real point is that you are asking why the "taxes AND FEES" differ --- why shouldn't they differ?  The line is selling them as different products -- while all those deals may look the same to you, the line is obviously calling them different things -- and if you look closely you will see that two of them - the "30% Savings" and the "Senior NRD" carry the same $166 fees - while the "Group 7116490 30% Savings" carries $217 in fees.    Unless you comb through the fine print, with a fine tooth comb, you cannot assume that the products are identical --are there different cancellation terms?, are there different privileges?  If you are convinced that there is absolutely no difference, do the intelligent thing and book the lower total cost deal.

 

 

[MisterBill99]

57 minutes ago, chengkp75 said:

Look at the fares from Royal themselves.  The "taxes and fees" category from travel agents very often include the "non-commissionable fare" as a "fee", so that they can offer a lower base fare (the commissionable portion).  While the cruise lines are regulated as to what can be included in the "port taxes and fees", travel agents are not.

 

Interesting point. So you're suggesting that they're fudging the numbers to make more of it non-commissionable, at least as far as the customer is concerned and in terms of what any OBC would be based on.

 

Royal is showing $185.75, so the same as the non-group rate.

[MisterBill99]

6 minutes ago, navybankerteacher said:

The real point is that you are asking why the "taxes AND FEES" differ --- why shouldn't they differ?  The line is selling them as different products -- while all those deals may look the same to you, the line is obviously calling them different things -- and if you look closely you will see that two of them - the "30% Savings" and the "Senior NRD" carry the same $166 fees - while the "Group 7116490 30% Savings" carries $217 in fees.    Unless you comb through the fine print, with a fine tooth comb, you cannot assume that the products are identical --are there different cancellation terms?, are there different privileges?  If you are convinced that there is absolutely no difference, do the intelligent thing and book the lower total cost deal.

 

Give me a break. They are the same product. The non-refundable deposits are clearly marked as NRD and one has the lower rate and another has the higher one. The difference in taxes/fees is based on whether it's a group rate or not.

[navybankerteacher]

1 hour ago, MisterBill99 said:

 

Give me a break. They are the same product. The non-refundable deposits are clearly marked as NRD and one has the lower rate and another has the higher one. The difference in taxes/fees is based on whether it's a group rate or not.

No, they are not “the same product” - one is being sold as an individual booking, the other is for each booking as part of a group.  Neither has a lower fare — both being $644, and both carrying the same $225 port charges.  The difference is in the fees.  
 

A group rate, by definition, applies to bookings made as part of a group.  Typically when a group books, depending upon the size of the group, one or more individual bookings within the group (likely the co-ordinator putting the group together - perhaps the bridal couple in the case of a destination wedding) gets a discount (or a free ride) off the quoted fare. The increased fee for bookings made as part of that group would serve to offset (for the benefit of the cruise line) that discount. 

Edited June 28, 2022 by navybankerteacher

[chengkp75]

7 hours ago, MisterBill99 said:

 

Interesting point. So you're suggesting that they're fudging the numbers to make more of it non-commissionable, at least as far as the customer is concerned and in terms of what any OBC would be based on.

 

Royal is showing $185.75, so the same as the non-group rate.

Well, the cruise line takes the fare and says, "this much is what we will pay a travel agent commission on, and this much we won't".  Then the travel agent is free to advertise the commissionable portion as the "base fare" and move the non-commissionable portion to "fees".  It's been a practice for years.

[sanger727]

11 hours ago, MisterBill99 said:

 

Interesting point. So you're suggesting that they're fudging the numbers to make more of it non-commissionable, at least as far as the customer is concerned and in terms of what any OBC would be based on.

 

Royal is showing $185.75, so the same as the non-group rate.

 

This is a common TA tactic. And, yes, I've seen that before. They pull the non-commissionable part of the fare out as a fee. Makes their rate look cheaper and lets them justify giving less OBC because your "rate" is lower. 

[MisterBill99]

On 6/28/2022 at 8:33 AM, sanger727 said:

 

This is a common TA tactic. And, yes, I've seen that before. They pull the non-commissionable part of the fare out as a fee. Makes their rate look cheaper and lets them justify giving less OBC because your "rate" is lower. 

 

Well, I haven't noticed it, but maybe it hasn't been as blatant. And I find it odd that there are two different groups at the same price but with different taxes.

 

In any event, I am likely going to end up booking the higher tax agent because they're currently offering free gratuities and $225 OBC, so their perks more than make up for the higher taxes. When I initially checked last week, they only had free specialty dining and less OBC and the lower tax agent had the better deal.

[njhorseman]

6 hours ago, MisterBill99 said:

 

Well, I haven't noticed it, but maybe it hasn't been as blatant. And I find it odd that there are two different groups at the same price but with different taxes.

 

In any event, I am likely going to end up booking the higher tax agent because they're currently offering free gratuities and $225 OBC, so their perks more than make up for the higher taxes. When I initially checked last week, they only had free specialty dining and less OBC and the lower tax agent had the better deal.

I think you're "finding it odd" because you're calling it "tax" when it's not tax, it's non-commissionable fare that the agency has added into their enumeration of taxes and fees rather than including it in the fare as the previous poster has explained.

Cruise lines are not permitted to break out the NCF that way but travel agents are permitted to and some do. 

Forget the artificial breakdown of the components and just focus on the bottom line total. 

 

[MisterBill99]

3 hours ago, njhorseman said:

I think you're "finding it odd" because you're calling it "tax" when it's not tax, it's non-commissionable fare that the agency has added into their enumeration of taxes and fees rather than including it in the fare as the previous poster has explained.

Cruise lines are not permitted to break out the NCF that way but travel agents are permitted to and some do. 

Forget the artificial breakdown of the components and just focus on the bottom line total. 

 

 

Beg to differ on cruise lines not being permitted to break out the fee. When I look on the Royal Caribbean site, it also shows those taxes and fees separately. $371.50 divided by two is $185.75, which is the $186 that the non-group fares are showing on the TA website I posted a shot of earlier.

 

Edited July 3, 2022 by MisterBill99

[njhorseman]

12 minutes ago, MisterBill99 said:

 

Beg to differ on cruise lines not being permitted to break out the fee. When I look on the Royal Caribbean site, it also shows those taxes and fees separately. $371.50 divided by two is $185.75, which is the $186 that the non-group fares are showing on the TA website I posted a shot of earlier.

 

You misunderstood what I said. Yes the cruise line is displaying taxes and fees separately. Many, but not all do. What the travel agency is including in that number is non-commissionable fare (NCF) which in the cruise line enumeration is included in what you're seeing as "Original Fare". Cruise lines are not allowed to break that NCF out of the fare . Travel agencies can break it out, resulting in an artificially low fare quote in their advertising and promotional materials.

Again, the only important number is the bottom line total, not how the components are displayed.

Edited July 3, 2022 by njhorseman

[ontheweb]

8 hours ago, njhorseman said:

I think you're "finding it odd" because you're calling it "tax" when it's not tax, it's non-commissionable fare that the agency has added into their enumeration of taxes and fees rather than including it in the fare as the previous poster has explained.

Cruise lines are not permitted to break out the NCF that way but travel agents are permitted to and some do. 

Forget the artificial breakdown of the components and just focus on the bottom line total. 

 

Yes, absolutely, it is the bottom line that counts.