Hawaii's high tourist tax, aimed at financing climate change initiatives, faces a legal challenge

In a surprising turn of events, the Cruise Lines International Association (CLIA) and a cruise ship supplier have filed a lawsuit against state and county finance officials in Hawaii. The lawsuit claims that the extension of the Transient Accommodations Tax (TAT) to cruise passengers violates the U.S. Constitution and federal law.

The lawsuit states that the state's counties each add their own 3% surcharge on top of the state's tax, bringing the total tax to 14%. This, according to the CLIA, imposes an additional financial burden on passengers already subject to substantial fees and taxes.

Hawaii's "Green Fee" bill, which was passed earlier this year, raises the tax on tourists who stay at Hawaii hotels to 11%, and now extends this tax to cruise passengers. The bill also imposes a new 11% tax on cruises.

The CLIA argues that cruise tourism is a major economic driver for Hawaii. With Stewart Chiron, known as "The Cruise Guy," stating that more people are cruising now than ever before, the CLIA points out the benefits that cruise tourism brings to Hawaii's economy.

The extension of the TAT to cruise passengers, the CLIA believes, threatens to deter visitors whose spending fuels this economic engine. This could lead to job losses and erode the financial stability of businesses dependent on tourism.

A portion of the revenue raised by the "Green Fee" will fund a "green jobs youth corps." The "Climate Mitigation and Resiliency Special Fund" and the "Economic Development and Revitalization Special Fund" are among the recipients of the revenue raised. The bill also addresses issues related to invasive species, wildlife conservation, and beach management and restoration.

The "Green Fee" is projected to generate $100 million annually. However, the lawsuit raises concerns about the fairness and constitutionality of the tax extension to cruise passengers.

Ashley J. DiMella, a Lifestyle reporter with our website Digital, is closely following this developing story. The Hawaii Department of the Attorney General has been served with the lawsuit complaint regarding the extension of the Transient Accommodations Tax (TAT) to cruise passengers.

As the legal battle unfolds, the impact on Hawaii's economy and the cruise industry remains to be seen. Stay tuned for updates on this intriguing story.