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Hawaii is poised to implement the nation’s first climate-focused lodging tax, a move that underscores the U.S. tourism hub’s growing urgency to fund environmental protection amid rising climate threats.
Lawmakers are expected to pass legislation this week that would raise the state’s hotel room tax by 0.75 percentage points, bringing the base rate to 11%, with revenues earmarked exclusively for climate resilience and conservation projects. Combined with county and excise taxes, the total levy on short-term accommodations will approach 19%, among the highest in the U.S.
Governor Josh Green, who supports the bill and has pledged to sign it, said the policy is a direct response to the $13 billion wildfire that devastated Maui in 2023, killing more than 100 people. The increase is projected to generate an additional $100 million annually.
“This is a significant way visitors can help us preserve Hawaii,” Green said, citing long-standing funding gaps in beach replenishment, wildfire prevention, invasive species removal, and infrastructure upgrades.
The tax revenue will support short-term climate initiatives, including installing hurricane clips on roofs and restoring coastal ecosystems, while a portion will be used to issue bonds for longer-term projects.
While Hawaii’s hotel industry expressed concern over increasing costs, it welcomed the fact that a steeper tax initially proposed was avoided. “No one wants more taxes, but the environmental investment could make this worthwhile,” said Jerry Gibson, president of the Hawaii Hotel Alliance.
Tourism is Hawaii’s economic backbone, with more than 10 million annual visitors. But that scale of activity has strained ecosystems and infrastructure, prompting calls for new models of sustainable tourism funding.
With constitutional barriers limiting direct visitor fees, lawmakers are framing the hotel tax hike as a compromise that aligns tourists’ impact with the cost of climate adaptation.
As Kāwika Riley, a member of the governor’s Climate Advisory Team, noted, “A guest may be new for a day, but in Hawaii, they’re expected to help care for the land.”
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