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Hawaii Advises Against “Visitor-Only” Fees + May Be Illegal

The state of Hawaii’s research arm, UHERO, based at the University of Hawaii, has just come out swinging as it advises “against a fee” that targets only tourists.

To begin, while it may be politically popular, we advise against a “fee” that targets only tourists. Protecting Oahu’s (and the state’s) natural resources benefits both residents and tourists, so both should pay. A visitors-only fee may also be illegal.

As you recall, Honolulu’s Oahu Destination Management Plan from the Hawaii Tourism Authority has proposed establishing a “Regenerative Tourism Fee” to support natural resources and conservation. That green fee would be charged to tourists and not residents.

It is noteworthy, as mentioned by UHERO, that “None of the other islands’ action plans have proposed such a fee, so the RTF would only apply to visitors to Oahu.” Also, it isn’t clear how it could be done legally, or if it is even possible.

UHERO goes further to question “whether a new fee or tax is even necessary.”

Green fee “may run afoul of the U.S. Constitution and federal laws.”

UHERO advises “To begin, while it may be politically popular, we advise against a “fee” that targets only tourists. A visitors-only fee may also be illegal. Lt. Gov. Josh Green’s proposal to levy a $50 visitor fee (i.e. a head tax) on visitors to Hawaii… may run afoul of the U.S. Constitution and federal laws.

Sales tax or property tax increase alternative.

Even if it is legal, UHERO says that it would be a “nightmare to administer.” UHERO said that should an additional fee be needed, it needs to be on everyone and not only on visitors. It suggests that property tax or excise (sales tax) increases are sensible alternatives.

Last weeks vote has confirmed current Lt. Gov. Josh Green as Hawaii’s next governor. His proposal to institute a $50 “impact fee” for visitors on arrival was a core part of his election campaign.

According to Green’s website, this fee would “generate up to $350 million in annual revenue to invest in protecting our environment, addressing climate change and building affordable housing, while reducing the total number of tourists.”

The Hawaii green fee – dead or alive?

This summer, Hawaii’s long-term prior marketing arm, HVCB, said the universal visitor fee is “dead on arrival,” per the state legislature. That’s the group that would theoretically be charged with implementing any fee such fee. Now, however, since they’ve been removed, it would be the responsibility of the Council for Native Hawaiian Advancement (CNHA).

The green fee, now opposed by UHERO, is to be charged to Hawaii visitors on arrival. Green proffered that would add $500+ million to the state’s coffers each year and that it would help mitigate environmental issues resulting from tourism.

More unaccountable Hawaii taxes and fees.

Something that both visitors and residents can agree on is that we just don’t know where the money that Hawaii collects goes. You need look no further than the airports, roads, and beach parks to make you shake your head in question and disgust. The 18% tax visitors are already accessed for all accommodations is going exactly where?

Perhaps there is another way to do this, but that path is unclear.

Honolulu previously had a proposal on the table for a $20 per guest fee added to accommodations. Keep in mind that when Hawaii residents stay at accommodations here, we pay the same taxes as visitors.

Do you concur with UHERO’s assessment?

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30 thoughts on “Hawaii Advises Against “Visitor-Only” Fees + May Be Illegal”

  1. For a state that needs tourists now you want to junk fee them.
    I won’t be going to hnl I guess and will stay at the better real hawaiian islands like big island and kauai.
    Hnl is just Los Angeles in the tropics who knows where the money will go..

  2. Mahalo for the interesting article. My two cents, if Hawaii needs money look at the property tax structure. A three million dollar home on Maui has a $9000/year property tax. Our tiny one bedroom vacation rental condo on Maui is taxed at $6000 a year. The three million dollar home is not likely owned by a local, why the “low” taxes. In comparison, a million dollar home in Seattle probably has a $9000/year property tax bill. I don’t get it.

    I’m not saying raise the property taxes on middle class people that live in Hawaii, I’m saying look at these low tax rates given to some of these expensive homes, that’s where they should be trying to get money.

    Thank you for letting me voice my opinion. I am totally against the fee!

  3. May be illegal? Imagine if every state imposed a “visitor fee” each time a person crossed the state line or arrived at an airport. The nation’s interstate commerce would come to a standstill. Sorry Hawaii, you’re just going to have to come up with another way to fleece the tourists.

  4. Tourism is Hawaii’s main industry. That’s what the state has fostered over many years. To tax tourists only is unfair and counterproductive. If you’re going to tax, tax everyone.


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