Cruise lines have warned Hawaii lawmakers that they intend to sue over “unconstitutional” cruise tax bills.
They have vowed to sue the state, warning it could impact cruise tourism in the Hawaiian Islands.
Two Different Bills Passed
It follows the passing of two separate bills in the two houses.
One is a per-passenger cruise fee that many destinations have imposed, such as in Alaska.
The other is an 11% tax per cabin fee, which lawmakers say would match the rate at which hotel and vacation rental guests are charged for stays in Hawaii.
Hawaii says cruise lines have benefited from lower overall fees compared to accommodation providers.
“All we’re asking for them is to pay their fair share. It should be a no-brainer,” House Tourism Committee Chair Rep. Adrian Tam says.
Cruise lines see it differently, especially Norwegian Cruise Line, which has the most to lose. NCL has the Pride of America ship permanently based in Hawaii.
NCL Says It Would Be an ‘Unconstitutional’ Tax
Daniel Farkas, Norwegian Cruise Line EVP and general counsel, said: “It’s simply unconstitutional. It has to do with uniformity as to when a vessel pulls into port. It’s simply so that everyone is treated equally.”
Farkas said it could lead to ships being pulled out of Hawaii.
“What that means is for a family of five, that’s an extra $500 to the price of a ticket. It is going to make the cost of a cruise simply unaffordable. “
Cruise lines wrote to the Hawaii Attorney General with an ultimatum: If a bill becomes law, we will sue.
“We ask that you advise the Governor of these issues and take action to avoid costly and time-consuming litigation should either of these proposals become law,” the letter said.
Norwegian Cruise Line executives have reportedly been holding meetings with lawmakers.
The cruise industry argues that cruise ship taxes are legally limited to covering the cost of port services.
Farkas added that Pride of America guests on a seven-day Hawaii cruise pay about $100 in port fees. He says these proposals would significantly increase this.
