The cruise industry’s leading trade group is suing Hawaii over a new tax on cruises and other travel accommodations.

The state passed the country’s first “Green Fee” earlier this year, raising its transient accommodations tax by 0.75% to 11% to fund climate change resiliency projects and other environmental efforts. The increased fee, set to take effect in 2026, applies to hotels, vacation rentals and – for the first time – cruises.

Cruise Lines International Association said, in an Aug. 27 lawsuit filed in the District of Hawaii, that the change violates federal law, in part because it conflicts with the U.S. Constitution’s Tonnage Clause.

Honolulu Ship Supply Co., Kaua’i Kilohana Partners and Aloha Anuenue Tours LLC are also listed as plaintiffs. They contend that the requirements place an undue burden on cruise lines and passengers and risk undermining Hawaii cruise tourism.

“If Act 96’s unconstitutional fees are permitted to take effect on January 1, 2026 … they will increase the cost of Hawai‘i bound cruises substantially and cause many potential visitors to vacation elsewhere,” the filing read. The complaint also targets additional county surcharges that would further increase costs.

“The counties of Kaua‘i, Honolulu, Maui, and Hawai‘i are home to all ports routinely visited by cruise ships in the State of Hawai‘i,” the complaint stated. “Between the 11% surcharge levied by the State and the 3% state-authorized surcharges levied by the counties, cruise-ship operators will be required to pay an effective 14% prorated portion of each passenger’s gross fare for the privilege of visiting ports in Hawai‘i.”

The Hawaii Department of Taxation referred USA TODAY’s request for comment to the state's Department of the Attorney General, which said it had not yet been served the complaint. “We will reserve comment until we have been served and have had a chance to review the complaint,” the department said in an emailed statement.

The County of Maui mayor's office referred a request for comment to Hawaii Governor Josh Green's office, which also referred USA TODAY to the Department of the Attorney General. The County of Hawai’i mayor's office declined to comment on pending litigation.

The County of Kaua’i mayor's office did not immediately comment, and the City and County of Honolulu did not immediately respond to a request for comment.

The cruise industry contributes more than $600 million annually to the state’s economy, with close to 300,000 visitors in recent years, according to the complaint.

(This story has been updated to add new information.)

Nathan Diller is a consumer travel reporter for USA TODAY based in Nashville. You can reach him at ndiller@usatoday.com.

This article originally appeared on USA TODAY: Cruise industry sues Hawaii over new 'Green Fee' tax

Reporting by Nathan Diller, USA TODAY / USA TODAY

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