Speeches & Testimony

Mr. Speaker,

Today I am introducing the Cruise Ship Fair Share Act, which confirms that states, territories and other non-federal entities may levy taxes on cruise ships, their passengers and their crew when those vessels are operating as tourist accommodations.

My legislation is prompted in part by recent litigation by cruise ship companies challenging Hawaii's application of its transient accommodations tax (TAT), a tax on all short-term accommodations like hotels, vacation rentals, timeshares and similar locations, to cruise ship operations in Hawai’i waters at Hawai’i ports. The TAT helps fund public infrastructure and environmental stewardship that is impacted by tourism operations, thus supporting both tourism and community impacts and resilience. Cruise ships, however, have challenged application of the TAT on federal grounds although accommodations on cruise ships are functionally no different from other transient accommodations and have the same impacts on our communities.

For Hawaiʻi, these issues are about more than tax policy alone. Our islands face growing demands to maintain public infrastructure, preserve fragile ecosystems, protect coastal resources and strengthen community resilience in the face of environmental challenges. At the same time, visitors and visitor-serving industries benefit enormously from Hawaii’s natural beauty and unique environment.

The Rivers and Harbors Appropriation Act, which this bill would amend, was never intended to exempt ships from generally applicable taxes. This bill confirms that states and territories have the ability to ensure that all sectors of the visitor industry, including cruise ships, help support the stewardship and preservation of the places and resources that make those destinations possible, and that sufficient resources remain available to protect them for future generations. As this bill would make clear, federal law does not place cruise ships in a preferred position over hotels, vacation rentals and other visitor accommodations in who does and does not share the responsibility of addressing operations impacts.

I urge my colleagues to support my measure and confirm the right of states and territories to ensure that those who benefit from their communities contribute fairly to their upkeep and future.