Hawaii’s Democratic Governor, Josh Green, has enacted a new law known as the “Green Fee” bill. This legislation will increase taxes on tourists to fund initiatives aimed at mitigating the effects of climate change. Starting from January 1, the tax on hotels in Hawaii will rise to 11%, and it will further increase to 12% the following year, as per the bill’s provisions.
The revenue generated from this tax hike will be allocated to the “Climate Mitigation and Resiliency Special Fund” and the “Economic Development and Revitalization Special Fund.” The bill aims to address issues such as invasive species, wildlife conservation, and beach management and restoration. Additionally, it will provide funding for a “green jobs youth corps” and other environmental concerns.
Governor Green, in a press statement, emphasized Hawaii’s commitment to preserving its natural resources, acknowledging their crucial role in maintaining the state’s ecological, cultural, and economic health. He further stated that the fee would be used to restore and remediate the state’s beaches and shorelines and to strengthen infrastructure vital to the health and safety of all Hawaii residents and visitors.
In 2023, Hawaii welcomed 9.6 million visitors, as reported by the Hawaii Tourism Authority. The state already imposes a 10.25% tax on short-term rentals. Additionally, each county in the state adds a 3% surcharge on top of the state’s tax.
Despite the existing taxes on the hospitality sector and short-term stays, which some consider high, the Green Fee is expected to generate $100 million annually, according to the press release.