Home / Business and Economy / Court blocks Hawaii's new cruise tax just before it takes effect
Court blocks Hawaii's new cruise tax just before it takes effect
3 Jan
Summary
- A federal appeals court halted Hawaii's new cruise tax one day before its Jan. 1, 2026, start.
- The tax, a 0.75% increase to fund climate change resiliency, was blocked by the Ninth Appellate Court.
- The Cruise Lines International Association argued the tax violates federal law and the U.S. Constitution.
A federal appeals court issued a stay on Hawaii's new 'Green Fee' tax, preventing it from being applied to cruises on January 1, 2026. The Ninth Appellate Court granted motions for preliminary injunctions to the Cruise Lines International Association and the U.S. Department of Justice, overturning a lower court's decision that would have allowed the tax to proceed. This climate change tax, intended to fund environmental efforts, would have increased the state's transient accommodations tax by 0.75% to 11%.
The legal challenge was brought forth by the Cruise Lines International Association (CLIA), which argued that Hawaii's new tax infringes upon federal law and the U.S. Constitution's Tonnage Clause. The trade group stated that cruise tourism contributes nearly $1 billion to Hawaii's economy and emphasized the importance of federal and state laws interacting correctly in regulating maritime commerce.
While the appeals court's decision temporarily blocks the tax on cruises, it remains active for hotels and vacation rentals as the legal process unfolds. CLIA expressed gratitude for the ruling and committed to pursuing the matter constructively through the courts while also seeking to collaborate with Hawaii on sustainable tourism initiatives.
