Appeals Court Blocks Hawaii's Climate Change Tourist Tax On Cruise Ships
Authored by Zachary Stieber via The Epoch Times,
A federal appeals court on New Year’s Eve blocked Hawaii from enforcing a new tax on cruise ship passengers, one day before it was set to go into effect.
Two judges of the U.S. Court of Appeals for the Ninth Circuit imposed an injunction on the law, reversing a lower court ruling.
The injunction against Hawaii’s tax is in place pending resolution of appeals, Circuit Judges Andrew Hurwitz and Daniel Bress stated in an order.
Cruise Lines International Association, which challenged the tax, and the Hawaii attorney general’s office did not immediately respond to requests for comment.
Hawaii had taxed short-term accommodations such as hotels.
With Act 96, scheduled to take effect on Jan. 1, the state increased the tax to 14 percent and extended it to cruise ships.
The law states that Hawaii “is experiencing a climate emergency” due to “the effects of climate change, such as rising temperatures,” and that the money garnered from the tax would go toward climate action.
Cruise Lines International Association said the tax violated the U.S. Constitution and a federal law called the Rivers and Harbors Appropriation Act (RHA) in its lawsuit.
U.S. District Judge Jill A. Otake, on Dec. 23, 2025, said that may or may not be true while declining to enter a preliminary injunction against the law.
“While the Court concludes that Plaintiffs have not established that they are likely to succeed on the merits because enjoining Act 96 would seemingly give cruise lines preferential treatment over land-based transient accommodations businesses, the Court acknowledges that the Tonnage Clause and the RHA are not litigated often and that the Court may ultimately come to a different conclusion about Act 96 later,” she wrote.
“Nevertheless, because of the ‘vital importance’ of taxes to the states, and because Congress has clearly expressed its intent ’to prevent federal-court interference with the assessment and collection of state taxes,' the Court treads carefully and denies the extraordinary relief of a preliminary injunction.”
Cruise Lines International Association and the U.S. government then asked the Ninth Circuit to intervene.
The association said in its appeal that the court should block the law’s extension to cruise ships pending appeal.
Hurwitz and Bress, in their brief order, said that the standard for evaluating an injunction pending appeal was similar to that employed by district courts deciding whether to enter a preliminary injunction. That standard includes weighing whether plaintiffs have shown a strong likelihood of success, according to a 2008 ruling they cited.
Tyler Durden
Thu, 01/01/2026 – 15:10