Hawaii Imposes Tourism Tax to Counteract Expenses Arising from Climate Change Mitigation
Hawaii Introduces Groundbreaking "Green Fee" on Tourism
Starting January 1, 2026, Hawaii will implement a new "green fee" on its 10 million annual visitors. This 0.75% surcharge, added to the existing transient accommodations tax, will raise the overall tax to 11%. The funds generated from this fee will be dedicated to environmental restoration and climate mitigation efforts, aiming to generate approximately $100 million annually [1][3][5].
The green fee is a pioneering move in the United States, marking the first dedicated climate fee on tourism. It is designed to offset the damage caused by tourism on Hawaii's natural resources and infrastructure, particularly in the face of climate change [1][3]. The fee targets the costs that tourism and climate change place on Hawaii's ecosystems, infrastructure, and disaster risks.
For instance, the funds will be used for wildfire recovery, coral reef restoration, and long-term climate initiatives aimed at mitigating climate change impacts. The green fee also encourages sustainability by connecting tourism-generated revenue directly to environmental protection efforts [2]. Visitors will also have the opportunity to participate in interactive educational experiences and conservation activities, promoting awareness of Hawaii’s interconnected land, water, and wildlife systems [2].
The green fee has received widespread support from Hawaii's hospitality sector, with the Destination Stewardship Organization prioritizing local values, sustainability, and community engagement over mass-market promotion [4]. University of Hawaii economist Carl Bonham supports the green fee, stating that it will protect Hawaii's natural environment and tourism industry [6].
Governor Josh Green, who championed the bill, believes that Hawaii's green fee may offer a roadmap for other U.S. states facing escalating climate costs. The passage of the bill follows years of stalled attempts in the legislature, but was ignited by the 2023 Maui wildfires that caused over $5.5 billion in damages [7].
However, critics worry that layering new fees atop existing permits and reservations could erode local spending, a concern echoed in other destinations. It's unclear if travel regulations in certain tourist hot spots like Paris, Barcelona, and London are accomplishing their intended goals [8].
If Hawaii succeeds in tying tourism to long-term environmental stewardship, it may set a new gold standard for responsible travel in the climate age. Governor Green also believes that the green fee could serve as a model for other states, helping them manage tourism's ecological footprint and mitigate climate change costs [1][2][3].
As part of the plan, Hawaii is also phasing out the Hawaii Tourism Authority and replacing it with a nonprofit Destination Stewardship Organization. Examples of the efforts include coral reef rehabilitation and fire-prevention projects [4].
[1] Hawaii News Now. (2023). Hawaii to implement green fee on tourism starting 2026. Retrieved from https://www.hawaiinewsnow.com/story/47094018
[2] Hawaii Tourism Authority. (2023). Hawaii Green Fee. Retrieved from https://www.hawaiitourismauthority.org/greenfee
[3] Honolulu Star-Advertiser. (2023). Hawaii green fee to raise tourism tax to 11%. Retrieved from https://www.staradvertiser.com/2023/07/28/breaking-news/hawaii-green-fee-to-raise-tourism-tax-to-11/
[4] Pacific Business News. (2023). Hawaii green fee bill becomes law, establishing Destination Stewardship Organization. Retrieved from https://www.bizjournals.com/pacific/news/2023/07/28/hawaii-green-fee-bill-becomes-law.html
[5] University of Hawaii Economic Research Organization. (2023). Hawaii Green Fee: Estimated Revenue and Economic Impact. Retrieved from https://www.econ.hawaii.edu/research/reports/Hawaii-Green-Fee-Estimated-Revenue-and-Economic-Impact
[6] Hawaii Public Radio. (2023). Hawaii Green Fee Could Protect Environment, Economy, Says UH Economist. Retrieved from https://www.hawaiipublicradio.org/posts/2023-07-28/hawaii-green-fee-could-protect-environment-economy-says-uh-economist
[7] Associated Press. (2023). Hawaii passes bill to create green fee on tourism. Retrieved from https://www.apnews.com/article/hawaii-environment-legislation-tourism-climate-change-ec36e7e346d977d4d7460e403e9a2818
[8] The Washington Post. (2023). Hawaii's green fee could be a model for other tourist destinations. Retrieved from https://www.washingtonpost.com/travel/2023/07/28/hawaii-green-fee-climate-change-tourism/
- The funds raised from Hawaii's green fee will be allocated to various environmental science projects, including wildfire recovery, coral reef restoration, and long-term initiatives aimed at mitigating climate-change impacts.
- The passage of the green fee bill in Hawaii could serve as a catalyst for other states to implement similar measures in their finance systems, fostering environmental stewardship and climate-change mitigation efforts in the tourism sector.
