Cruise industry files lawsuit against Hawaii over new “green fee”
On August 27, the Cruise Lines International Association (CLIA), together with several local companies, filed a lawsuit in the U.S. District Court for Hawaii seeking to block implementation of the state’s new “green fee” law.
The law, passed in May and scheduled to take effect on January 1, introduces:
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an increase in the hotel and short-term rental tax from 10.25% to 11%,
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for the first time, an 11% fee on cruise passengers while ships are in Hawaiian ports,
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authority for local governments to add an additional surcharge of up to 3%.
Hawaiian officials say the additional revenue will be directed toward addressing the impacts of climate change, including beach erosion and wildfires such as the devastating 2023 Maui fire. Projections estimate the tax could raise up to $100 million annually.
Cruise industry arguments
In its filing, CLIA claims the “green fee”:
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violates the U.S. Constitution and the “tonnage clause,” which limits state-imposed charges on navigable waters,
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is disproportionate compared to hotel and rental taxes,
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is unfair as it provides no exemptions for cruise passengers,
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infringes on free speech by requiring cruise lines to post onboard notices and include tax information in all Hawaii-related advertising.
CLIA argues the new levy will significantly raise the cost of Hawaii cruises, making them less attractive for families and ultimately harming both state tourism and local businesses that depend on cruise visitors.
Context
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In 2023, Hawaii welcomed over 9.6 million visitors, including about 3 million cruise passengers.
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A court hearing on the lawsuit is scheduled for late October.
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The cruise industry has successfully fought similar cases before: in 2016, CLIA challenged per-passenger taxes in Juneau, Alaska, with the court ruling in its favor in 2018.
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Globally, pressure on the industry is growing: Greece and Mexico have also moved to introduce new passenger levies in response to tourism-related impacts.
