Posted on Friday, June 6, 2025
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by Kamden Mulder
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Despite already levying some of the highest taxes of any state in the country, Hawaii will now look to rake in an additional $100 million per year from tourists thanks to a new bill Democrat Governor Josh Green signed into law last week. But past wasteful spending from the Democrat-dominated state government raises real questions about where that money is actually going.
Billed as a “green fee” or “climate change tax,” Act 96 will raise the occupancy tax on Hawaii hotels to 11 percent starting next year and 12 percent in 2027. The new revenue will then be diverted to the “Climate Mitigation and Resiliency Special Fund” and the “Economic Development and Revitalization Special Fund,” according to the bill.
Beginning next July, cruise ships – which had previously avoided the Transient Accommodations Tax (TAT) – will also have to pay when docking in Hawaii. That means cruises with stops at any of the islands will likely get even more expensive.
For a state that relies so heavily on tourism, imposing ever-increasing taxes on mainlanders looking to vacation there may ultimately prove to be a counterproductive strategy.
Tourism is by far the single largest industry in Hawaii, accounting for $20 billion annually in revenue – a quarter of the state’s GDP. More than $1 billion of that comes from the TAT alone. Under the new law, approximately 19 percent of the cost of a hotel stay will be taxes.
That hefty premium could leave many tourists looking elsewhere to spend their leisure time – and money. Local Hawaiians also won’t be excluded from the tax, meaning that if they travel between islands to see friends and family and stay at a hotel, they’ll have to pay the tax as well.
Moreover, prior revelations about wasteful spending by the state government and the Hawaii Tourism Authority (HTA) raise real questions about whether the new funds from the tax will be used for environmental conservation or to line the pockets of left-wing special interests.
Just last month, a scathing audit of a recent initiative to supposedly make Hawaiian tourism more sustainable uncovered enormous levels of wasteful and ineffective spending.
Known as the Destination Management Action Plans (DMAPs), the HTA program was created with the stated goal of “reflect[ing] a growing recognition of the need for a regenerative tourism model — one that gives back more than it takes. These plans aimed to realign tourism with community values while addressing long-standing concerns about its impact on residents, resources, and infrastructure,” according to the HTA website.
But according to Beat of Hawaii, the DMAPs “lacked structure, failed to address key problem areas, and spent public funds with little oversight or any measurable results.” An internal agency tracker for the program reportedly “frequently logged meetings or vague discussions as signs of progress. There were no clear benchmarks, consistent metrics, or accountability.”
The audit showed that the time and money the HTA spent were barely reflective of what local Hawaiians were hoping for, including spending $8,000 to clean up the Hawaiian temple Malae Heiau, a spot not currently open to the public. HTA also allocated $2,500 to create a children’s coloring book on deforestation to give out at Hawaiian hotels, as well as $44,505 on reusable water bottles at Maui resorts. Over $100,000 was spent to provide reef-safe sunscreen to tourists at 24 of Maui’s highest-trafficked beaches.
According to Beat, largely as a result of the dismal failure of the program, there is a growing sense among Hawaii locals “that trust in the state’s tourism leadership has eroded – and that the system designed to balance visitor impact with resident well-being is no longer working.”
Trust has eroded so much, in fact, that the Hawaiian government announced earlier this month with no warning that HTA would be phased out entirely. In its place will be a new nonprofit “Destination Stewardship Organization” that “emphasizes community values, sustainability, and control.”
Given these revelations, do Aloha State residents – or anyone else for that matter – have any reason to believe the funds from the state’s new climate change tax will be spent wisely? One need only look at the hundreds of billions of dollars in wasteful spending from the Biden administration’s so-called “Inflation Reduction Act” to see that dollars for “green” initiatives hardly ever end up addressing legitimate environmental concerns.
Hawaii’s new “climate change tax” is just the latest example of the failed liberal playbook: tax more, promise more, and deliver less. Despite already soaking residents and tourists alike with some of the highest taxes in the nation, the state government keeps coming back for more – and each time, the results get worse.
Democrats claim these new levies will fund bold environmental initiatives, but if recent history is any guide, the money will be squandered on meaningless PR campaigns, woke nonprofits, and feel-good projects with no accountability.
Yet again, Americans are learning that liberal governance means bloated bureaucracies, no measurable outcomes, and a constant disregard for the economic well-being of everyday citizens. The Aloha State deserves better – and so does the rest of America.
Kamden Mulder is a senior at Hillsdale College pursuing a degree in American Studies and Journalism. You can follow her on X @kamdenmulder_.
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