Overview

• Hawaii lawmakers are poised to approve a bill increasing lodging and cruise cabin taxes to fund climate mitigation and adaptation projects.
• The new taxes, scheduled to take effect on January 1, 2026, will raise approximately $100 million annually for programs like beach restoration, wildfire prevention, and infrastructure storm-proofing.
• Governor Josh Green has championed the initiative, calling it a 'green fee' and emphasizing its importance after the devastating 2023 Maui wildfires.
• The hotel industry has expressed mixed reactions, while cruise ship companies plan to challenge the 11% cabin tax in court, citing constitutional concerns.
• If enacted, Hawaii will become the first U.S. state to earmark lodging tax revenue specifically for environmental and climate-related purposes.