A federal appeals court has temporarily blocked Hawaii from enforcing a new climate change tax on cruise ship passengers. The ruling, issued on New Year’s Eve, pauses the state’s effort to address the environmental impact of tourism. As per CBS News, Act 96 would have imposed an 11% tax on cruise ship passengers, which could reach up to 14% when combined with county surcharges.
The Cruise Lines International Association (CLIA) challenged the tax, arguing it would raise cruise costs and potentially harm Hawaii’s tourism-dependent economy, and claimed it violates the U.S. Constitution by taxing ships for entering state ports. U.S. District Judge Jill A. Otake had previously upheld the law, but two 9th Circuit judges issued an injunction pending the appeals process. Hawaii Attorney General’s Office spokesperson Toni Schwartz told CBS News that the state remains confident Act 96 is lawful and expects it to be upheld on appeal.
State officials have expressed continued commitment to implementing the law despite the temporary injunction. The Department of the Attorney General noted that the Ninth Circuit’s order halts enforcement of Act 96 on cruise ships while the appeals process proceeds, but emphasized confidence in the law’s legality, according to a statement obtained by KHON2 News.
The Green Fee remains a contentious issue in Hawaii. Governor Josh Green supports the measure, stating that visitors benefiting from the islands’ resources share a responsibility to help preserve them. In contrast, Cruise Lines International Association spokesperson Jim McCarthy highlighted potential economic risks, noting the industry generates nearly $1 billion in economic impact for Hawaii and supports thousands of local jobs.
While the cruise ship tax faces a temporary halt, other components of the Green Fee have gone into effect to address Hawaii’s climate concerns. The outcome of the legal challenge could influence how states balance economic activity with environmental conservation and may set a precedent for similar legislation nationwide.
