Travelers planning a bucket list cruise to Hawaii in 2026 woke up to welcome news this New Year.

A federal appeals court has blocked the state from enforcing its new “green fee” on cruise ship passengers, meaning vacationers will not face an extra 11 percent cruise tax on itineraries that include Hawaii ports, at least for now.

The decision, issued by the Ninth U.S. Circuit Court of Appeals on December 31, pauses one of the most closely watched tourism measures in the United States and removes a major pricing uncertainty for the cruise industry and its customers.

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What Exactly Did The Appeals Court Decide?

The Ninth Circuit’s ruling is a preliminary injunction that temporarily stops Hawaii from applying its climate change tourist tax to cruise ship passengers while a broader legal challenge moves forward.

The law at issue, known as Act 96, was signed by Governor Josh Green in May 2025 and scheduled to take effect on January 1, 2026.

It raises the state’s transient accommodations tax and, for the first time, extends it directly to cruise ship passengers calling at Hawaii ports.

Under Act 96, cruise passengers would have paid an additional 11 percent tax on the gross fare for their voyage, prorated for the number of days the vessel spends in Hawaii waters.

Counties were authorized to tack on a further 3 percent, potentially pushing the total cruise-related levy to as much as 14 percent of the prorated fare.

The appeals court’s New Year’s Eve order halts enforcement of the cruise portion of the tax only; the increases on hotel and vacation rental stays remain in place.

The injunction does not permanently strike down the tax. Instead, it restores the status quo while judges consider arguments that Hawaii’s law violates federal statutes and constitutional protections governing maritime commerce and port charges.

For travelers, the practical effect is immediate: for cruises already booked or currently on sale for 2026 that include Hawaii stops, there will be no new state “green fee” added to the ticket price unless and until a future court ruling changes course.

How The Cruise Tax Was Supposed To Work

Hawaii positioned its new levy as a climate resilience measure, designed to generate roughly 100 million dollars a year for projects addressing shoreline erosion, wildfire risk and other environmental impacts linked to global warming.

State lawmakers framed the “green fee” as a way for visitors to help pay for the environmental footprint of their stay, whether they slept in a hotel room or sailed in on a cruise ship.

The structure of the law, however, made cruises a particularly visible target. The 11 percent tax applied not to onboard spending, but to the underlying cruise fare, apportioned by the days a ship spends in Hawaii.

For a week-long cruise where three days were in Hawaiian ports, nearly half the fare could be subject to the state’s levy and any county surcharge.

Industry advocates said this would significantly raise the cost of Hawaii itineraries compared with rival sun-and-sea destinations.

Critics within the cruise sector also noted that Hawaii already benefits from standard visitor spending on shore excursions, dining and shopping.

By layering on a separate, Hawaii-specific fare tax of up to 14 percent, they argued, the state was effectively charging cruise ships and their guests for the privilege of entering its ports, something federal maritime law and the U.S. Constitution have long limited.

The case that led to the appeals court’s ruling was brought by Cruise Lines International Association (CLIA), which represents most of the major global cruise brands, along with several Hawaii-based businesses that serve cruise ships or rely on cruise visitors.

Their lawsuit, filed in 2025, argued that Act 96 runs afoul of the Constitution’s Tonnage Clause, which restricts states from imposing taxes on vessels for entering or using their ports, and conflicts with federal laws governing navigation and harbor charges.

In late December 2025, a federal district judge in Honolulu rejected a request to block the tax from taking effect, allowing the law to proceed as scheduled. That decision prompted an emergency appeal to the Ninth Circuit.

The U.S. Department of Justice took the unusual step of siding with the cruise industry, telling the court that Hawaii’s scheme improperly targeted vessels and intruded on federal authority over maritime commerce.

On December 31, a two-judge panel of the Ninth Circuit granted the cruise industry and the federal government’s request for an injunction.

In doing so, the court signaled that the challengers had raised serious questions about the law’s legality and that allowing the tax to begin on January 1 could cause immediate economic disruption and irreparable harm to cruise operators and travelers who plan their trips years in advance.

Hawaii officials responded by stressing that the ruling is temporary and applies only to cruises. The state attorney general’s office has said it remains confident Act 96 will ultimately be upheld when the full merits of the case are heard, pointing to the lower court’s earlier decision in their favor.

That sets up a protracted legal battle likely to shape how far states can go in taxing and regulating visiting cruise ships.

What This Means If You Already Booked A 2026 Hawaii Cruise

For travelers with Hawaii cruises on the books for 2026, the most important takeaway is straightforward: you should not see a new Hawaii-specific cruise tax added to your fare as a result of Act 96 while the injunction is in place.

The appeals court order arrived just hours before the law was to start, which means cruise lines have effectively been spared from recalculating and reissuing invoices for New Year departures and for sailings later in the year.

Many cruise companies had warned that they would need to either increase advertised fares, add destination-related surcharges, or reconsider how often their ships call in Hawaii if the levy went ahead. Some travelers had delayed booking 2026 itineraries because of the uncertainty around potential price hikes.

The court’s decision removes that cloud in the near term, stabilizing pricing for published 2026 sailings that include Honolulu, Hilo, Kona, Kauai and other Hawaii ports.

If you booked prior to the ruling, you may see language in your contract giving the cruise line the right to pass through new taxes and fees imposed by governments. With the Hawaii cruise tax now blocked, those particular charges should not materialize.

Travelers should still read their booking confirmations and final statements closely, but any state “green fee” tied specifically to cruise fares is off the table unless the courts later reverse course and allow enforcement.

Travel advisors recommend that guests who were on the fence about Hawaii itineraries because of possible cost surges take a fresh look at 2026 sailings.

With airfares and onboard prices already under inflationary pressure, the removal of an extra double-digit cruise fare tax makes Hawaii more competitive again compared with other Pacific or Caribbean routes.

How The Ruling Could Affect Future Cruise Pricing And Itineraries

While the Ninth Circuit’s order is framed as an interim measure, within the travel industry it is already influencing how cruise lines plan their capacity and deployments for 2026 and 2027.

Operators value predictability when scheduling ship rotations, shore arrangements and marketing campaigns.

A clear message that Hawaii cannot collect a special cruise tax in 2026 lowers the risk of sudden, destination-specific cost spikes that might have forced itinerary changes.

Analysts say the injunction reduces the likelihood that major cruise lines will scale back Hawaii calls in the short term.

Before the ruling, some industry voices warned that the combination of the base 11 percent levy and a possible county add-on could make certain routes uneconomical, especially for ships doing multi-island loops or repositioning voyages that only lightly feature Hawaii.

The court’s move strengthens the case for maintaining or even expanding Hawaii programs in response to strong post-pandemic demand.

However, the blocked tax may not be the last attempt to ask visitors by sea to pay more. Other destinations around the world, from European cities to small island nations, are experimenting with head taxes, port sustainability fees and day-tripper surcharges aimed at cruise passengers.

Whatever the final outcome of Hawaii’s case, the debate it has sparked about who should pay for climate and infrastructure impacts is likely to echo through future pricing decisions and port negotiations.

Impact On Hawaii Tourism And Climate Funding Plans

For Hawaii’s tourism planners, the appeals court decision is a double-edged development. On one hand, it protects a lucrative slice of the visitor economy.

Cruise tourism is estimated to generate close to a billion dollars annually in total economic activity across the islands and supports thousands of jobs in port services, tours, retail and hospitality.

Keeping cruise fares lower and schedules intact should help sustain that flow of spending into 2026.

On the other hand, the injunction punches a hole in the state’s near-term vision for funding climate adaptation through visitor contributions.

Act 96 was built on the idea that both overnight guests and cruise passengers would jointly help cover the rising costs of coastal protection, wildfire recovery and ecosystem restoration.

With the cruise piece now on hold, hotel and vacation rental visitors bear a larger share of the burden, and projected revenue for climate projects may fall short of initial projections.

Local environmental advocates have warned that delaying or downsizing climate resilience investments in Hawaii could have real-world consequences, from vulnerable beachfront roads to communities at risk from extreme weather.

The state can still move ahead with projects funded by the higher lodging taxes that did take effect, but may need to adjust timelines or seek alternative funding sources if the cruise ship segment of the “green fee” remains tied up in court or is ultimately struck down.

For now, tourism officials are emphasizing that visitors will find Hawaii “open and welcoming” in 2026, by land and by sea, and that the legal battle centers on how climate efforts are funded rather than whether they are needed.

The outcome will be closely watched by other destinations wrestling with similar questions of overtourism, environmental protection and economic reliance on travel.

What Travelers Should Watch For Next

Although the immediate message for 2026 cruise guests is reassuring, the legal story behind the tax is not over. The Ninth Circuit’s injunction preserves the status quo while the appeals court reviews full written arguments and, potentially, hears oral argument on whether Act 96’s cruise provisions can stand.

That process is expected to unfold over several months, with no firm timetable yet for a final ruling.

If the appeals court ultimately sides with Hawaii, it could clear the way for the state to reinstate a modified cruise tax in a later year, perhaps 2027 or beyond, depending on how quickly lawmakers and regulators move.

If the court agrees with CLIA and the Justice Department that the law overreaches, Hawaii may have to rethink how it structures any future visitor levy tied to maritime arrivals, potentially focusing instead on per-passenger port fees that pass federal muster.

For consumers, the key is to focus on the concrete timelines in play. Cruises operating in the 2026 calendar year, and particularly those already on sale, are now shielded from Hawaii’s new cruise tax by the injunction.

Those looking ahead to 2027 and 2028 should stay tuned. If the courts issue a definitive ruling that reshapes Hawaii’s authority in this arena, travel agencies, cruise lines and state tourism offices are likely to update their guidance and promotional materials quickly.

Travelers who want to be proactive can ask their cruise line or travel advisor whether their itinerary pricing assumes any future destination-specific taxes and how such changes would be handled in terms of fare adjustments or onboard credits.

For now, though, the biggest uncertainty that had been hanging over Hawaii’s 2026 cruise season has been lifted.

FAQ

Q1. Is the Hawaii cruise tax completely canceled or just paused?
The tax is currently paused, not permanently canceled. The Ninth Circuit Court of Appeals issued a preliminary injunction that blocks Hawaii from enforcing the cruise portion of its “green fee” while a legal challenge continues.

Q2. Will I pay any extra Hawaii tax on my 2026 cruise fare?
No, under the current court order you should not see the new Hawaii cruise tax applied to your 2026 fare. Regular port charges and existing taxes may still apply, but the specific Act 96 cruise levy is on hold.

Q3. Does this ruling affect hotel and vacation rental taxes in Hawaii?
No. The injunction covers only the cruise ship provisions of the law. Increased taxes on hotel rooms and vacation rentals under the same statute remain in effect, so land-based visitors may see higher lodging taxes.

Q4. Could Hawaii reinstate a cruise tax in 2027 or later?
Yes, it is possible. If Hawaii ultimately wins in court or enacts a revised law that complies with federal rules, a cruise-related tax could return in a future year. Any such change would likely be announced well in advance.

Q5. Why did the cruise industry sue over the tax?
Cruise Lines International Association argued that Hawaii’s law illegally taxed ships and passengers for entering state ports and would make Hawaii itineraries significantly more expensive, potentially driving travelers to other destinations.

Q6. How much would the tax have added to the price of a cruise?
The law called for an 11 percent tax on the prorated gross cruise fare for days spent in Hawaii, with counties able to add up to 3 percent more. In total, the charge could have reached 14 percent of the prorated fare portion tied to Hawaii port days.

Q7. Does this ruling change my existing cruise booking contract?
Your contract terms remain the same, but the specific Hawaii cruise tax that might have been passed through to you will not be charged while the injunction is in place. It is still wise to review your final invoice before sailing.

Q8. Are 2026 Hawaii cruises now cheaper than they would have been?
In practical terms, yes. Without the new state cruise levy, prices for Hawaii sailings avoid a significant potential increase. Fares may still fluctuate due to demand and other factors, but they will not include the blocked tax.

Q9. Does the federal government support or oppose Hawaii’s cruise tax?
In this case, the U.S. government intervened on the side of the cruise industry, arguing that Hawaii’s law conflicted with federal maritime law and constitutional limits on state port charges.

Q10. Should I book a Hawaii cruise now or wait for the final court decision?
If you are looking at 2026 departures, the current injunction means your fare will not include the new Hawaii cruise tax, which is favorable for booking now. For 2027 and beyond, it may be worth following the case’s progress, but any major change would likely come with advance notice from cruise lines and travel advisors.