Querying recovery fees when hiring a car

| 13/09/2016

I’m looking into prices to hire a car for some visitors. From previous experience hiring a car on island, I’ve noticed the base price quoted on websites can be wildly different to the total amount charged. It seems one of the reasons for this is a charge for Vehicle Environmental Recovery Fee and Licence Recovery Fee. In some cases, this fee is more than the daily cost of the car. After looking at a few different car rental websites, the information on these charges is not really very clear. Some companies say it is a “compulsory fee”, while some companies say it is a “government” tax. I can’t find any information from government regarding these charges. Also, the amount charged by each company varies from US$6.50 up to US$10 per day. Surely if this is a government-enforced tax, the amount charged should be the same for all the companies? Are these really government taxes or is this a charge that is being used by the rental companies to increase their daily rate without increasing the “published” rate? It seems very misleading.

Auntie’s answer: I approached a source in the industry who explained the fees. Without going into his detailed description and chronology of the government-levied fees on car-hire companies, he said that several years ago, when government first imposed environmental fees on hire cars for such things as batteries and tyres, the businesses collectively decided it was necessary to recoup some of the cost. After that, licensing fees were raised, leading to additional so-called recovery fees.

When you book a car, you can find these charges itemised on their websites, though some companies may call them ‘fees’ and others incorrectly refer to them as ‘taxes’.

As you mention, the charges do vary since this amount is not regulated by the government and is set by each individual car rental business. I guess some feel a need to recover a larger portion of the fees than others.

Depending on the time of year, the cost of hiring a car can also vary, with low-season fees often so low that the extra charges will add up to more than the basic cost of the vehicle. I can see how that would be annoying, but there doesn’t seem to be anything untoward going on.

I’m not sure this will make you feel any better, but car-hire companies in the US also add various fees to the bill, such as an energy surcharge and vehicle licensing cost recovery, so the situation in Cayman is not unique.


Category: Ask Auntie

Comments (6)

Trackback URL | Comments RSS Feed

  1. Anonymous says:

    This is a coordinated sham to goose up the rental fee. Car rental agencies sell cars to renew their fleets every 3-6yrs. Unless there is a crash covered by insurance, the job of disposing of noxious car parts on the car’s eventual demise passes to the next owners or perhaps several owners down the line.

  2. Anonymous says:

    So these “fees” are not taxes being charged, but illegal fees being gouged on tourists in a misleading way.

    • Anonymous says:

      Fees are fees. Just compare the total prices for heavens sake. Rental cars are one of the chespest things on the island.

  3. Anonymous says:

    Government charges $2 per tire and $5 per battery… Those rates seem extortionate if they are charged on each rental – how many tires and batteries do they go through? I have rented hundreds of cars over the past few decades and have never had a flat tire or dead battery… I would boycott any rental firm that uses these as an excuse for the rental charges… Never the $250 vehicle disposal fee is not an excuse… If a car stays I. The rental fee for 3 years this works out to 25 cents per day… Hmmmm… Rip off by the rental firms…

  4. Anonymous says:

    Why doesn’t the poster consider just going to DVLD and get a visitors driving permit for the duration of the stay & let them use their car ? Problem solved. Most insurance companies cover while any licensed driver over & under a certain age is in charge of the vehicle. Just imagine how much $$$ you will save !

  5. Anonymous says:

    Its a license to print money. Over the lifetime of the car you pay the environmental fee over and over. Its the same in the USA. Tax or fee just sounds better than ‘ripping you off’.