Hawaii’s latest attempt to squeeze more cash from tourists has hit a judicial roadblock.
The state’s so-called "Green Fee" plan, which would jack up taxes on visitors—including a hefty 11% levy on cruise passengers to bankroll climate projects—has been temporarily stopped by a federal court, Fox News reported.
Back in early September 2025, the Cruise Lines International Association (CLIA), alongside a cruise ship supplier, launched a legal challenge against Hawaii’s state tax and county finance officials. They argued this new tax unfairly targets an industry that’s a vital economic engine for the state.
The "Green Fee" bill isn’t just a small surcharge—it’s a full-on tax assault, including the Transient Accommodations Tax, which piles on extra costs for hotel stays and slaps that 11% rate on cruise passengers. On top of that, counties add their own 3% surcharge, pushing the total hit to a staggering 14% for those cruising to the islands.
This revenue, projected to rake in $100 million a year, was supposed to fund everything from a "Climate Mitigation and Resiliency Special Fund" to beach restoration and even a "green jobs youth corps." While protecting nature sounds noble, conservatives might ask: at what cost to the average visitor or the businesses relying on tourism?
Cruise tourism, with over 168,000 visitors sailing to Hawaii in 2024 per the Hawaii Tourism Authority, isn’t just a footnote—it’s a major driver of the state’s economy. Slapping extra taxes on these passengers risks choking off a key revenue stream for local businesses.
The CLIA didn’t mince words in their opposition. “We believe the extension violates both the U.S. Constitution and federal law, while imposing an additional financial burden on passengers already subject to substantial fees and taxes,” a representative stated. If that’s not a red flag for government overreach, what is?
They went further, warning, “Extending the TAT to cruise passengers threatens to deter visitors whose spending fuels this economic engine, risking job losses and eroding the financial stability of businesses dependent on tourism.”
From a populist standpoint, this isn’t just about big cruise lines—it’s about the small shops, tour guides, and workers who could take the hit.
On the other side, Hawaii’s officials aren’t backing down. “We remain confident that Act 96 is lawful and will be vindicated when the appeal is heard on the merits,” said Toni Schwartz, spokesperson for the Hawaii attorney general’s office.
Confidence is nice, but conservatives might wonder if this is just another case of progressive priorities trumping practical economics.
The state claims the funds would tackle real issues like invasive species, wildlife conservation, and beach management. Fair enough, but shouldn’t there be a balance that doesn’t punish tourists who are already shelling out big bucks to enjoy Hawaii’s beauty?
By Dec. 31, 2025, the Ninth U.S. Circuit Court of Appeals stepped in with an injunction, hitting pause on the cruise tax enforcement while the appeal plays out. This temporary halt gives breathing room to an industry under siege and to visitors who’d bear the brunt of these costs.
Revenue from the "Green Fee" was also slated for an "Economic Development and Revitalization Special Fund," which sounds promising on paper. But from a right-of-center view, when does “revitalization” become just another excuse for bloated state spending?
For now, the court’s injunction keeps the taxman at bay, but the fight is far from over. Hawaii’s tourist industry, and the families planning their next getaway, deserve a full investigation into whether this policy is a genuine fix for environmental woes or just a cash grab dressed in green rhetoric.
Let’s keep the pressure on to ensure that policies like these don’t sneak through without real scrutiny. After all, in a state where tourism is king, burdening visitors with extra taxes could turn a tropical paradise into a fiscal nightmare for locals and travelers alike.
