Hawaii: Travelers will pay a climate tax starting in 2026

The islands of the U.S. state of Hawaii are among the regions suffering most from the effects of climate change. Coastal erosion, extreme weather events, and wildfires—most recently the devastating fires on Maui in 2023 —highlight the urgent need for climate adaptation measures. Against this backdrop, Hawaii intends to rely more heavily on tourism revenue to finance environmental protection projects in the future.

The idea: A new "climate tax" for travelers would provide the necessary funds for the state coffers. Hawaii Governor Josh Green passed the corresponding legislation on Tuesday, May 27, 2025. The Senate had already given its approval. Hawaii claims that this makes it the first U.S. state to enact a "climate tax" on tourists to specifically finance measures to combat the effects of climate change.

The new law will come into force in 2026. It proposes increasing the existing overnight tax for hotels and holiday accommodations from 9.25 percent to 10 percent .

A separate tax rate of 11 percent will be introduced for cruise ships, although industry representatives have already announced that they will challenge this legally.

The Hawaiian governor had already planned similar initiatives in the past. He had already discussed a tourism environmental tax during his election campaign and later in connection with the Maui wildfires. However, the proposed measure is a watered-down version of previous proposals. According to the government, the decision was deliberately made against more drastic tax increases in order to minimize the economic burden on the tourism industry and the risk of negative publicity, especially at a time of economic uncertainty for many US citizens.

According to a recent announcement, the "climate tax" for tourists is expected to generate $100 million (approximately €88 million) annually. The Green Administration will work with Parliament to approve projects in the next session as soon as the necessary revenue is available, it added.

The additional tax revenue will be used specifically for environmental projects, including the restoration of beaches and coastlines, the climate-resilient transformation of public infrastructure, and the reforestation of native forests.

Hawaii's reefs, beaches, hiking trails, and other scenic destinations are intended to be kept in good condition and remain attractive to travelers. Whether travelers will continue to travel despite the price increase or whether numbers will decline will only become clear once the new regulations take effect.

Hawaii is already considered one of the most expensive travel destinations in the world, so rising prices could certainly have an effect on tourism.

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