Key Takeaways (read this first)
- Start date: January 1, 2026. Hawaii will apply its Transient Accommodations Tax (TAT) at 11% to cruise fares, calculated only for the portion of a voyage spent docked in Hawaii. That portion is determined by the ratio of Hawaii dock days to total voyage days. files.hawaii.gov
- Where this comes from: Act 96 (2025) and Hawaii Department of Taxation Announcement 2025-03 confirm the rate change to 11% and the new imposition on cruise fares with proration by days docked. files.hawaii.gov+1
- County add-on: Counties may also impose a 3% county TAT surcharge on the same prorated portion (bringing the total to up to 14% on the Hawaii-docked share), subject to local adoption. This authority is referenced in coverage of the law and litigation; monitor final county rules. AP News+2E&E News by POLITICO+2
- Separate from port fees: This does not replace port or harbor charges. Lines already pay (and pass through) various port fees; the TAT is separate and new for cruise fares. Courthouse News+1
- Booking timing matters: Whether a fare is taxed at 10.25% vs 11% (for land lodgings) and whether cruise fares fall under TAT at all can depend on accounting method and when payment/right to receive is fixed (cash vs accrual). The Department’s announcement explains the timing rules. For cruise fares, cash-basis receipts before Jan 1, 2026 are not subject to TAT. files.hawaii.gov
Why this matters to cruisers
Hawaii’s new rule directly adds a tax to the cruise fare (not just hotels and vacation rentals). For some itineraries—especially NCL’s Pride of America seven-night Hawaii cruises where every day is spent in the islands—100% of the fare will be the base for the 11% state TAT (plus any county TAT that a county adopts). For longer transpacific or repositioning voyages with only a few Hawaii calls, only that fraction of the fare is taxed. The effect on your total trip cost can range from modest to significant, depending on the itinerary.
The change is codified, dated, and specific—which means travel sellers, cruise lines, and guests need to update quotes, budgets, and FAQs well before sailings in 2026. Hawaii’s Department of Taxation states plainly that the proration is “according to the ratio of the ship’s days docked in State ports to the duration of the total voyage.” files.hawaii.gov
There’s also ongoing litigation: the Cruise Lines International Association (CLIA) sued to block the cruise-fare TAT extension. As of August–September 2025, coverage indicates the case is pending; a court could change timing or application. Until that happens, plan for Jan 1, 2026 implementation. Seatrade Cruise News+1
Official timeline
- May 2025: Legislature passes the bill; Governor announces the “Green Fee” framework and intent. Hawaii Governor’s Office
- June 9, 2025: Department of Taxation issues Announcement 2025-03 detailing the 11% rate and cruise-fare proration by Hawaii dock days; explains cash vs accrual timing. files.hawaii.gov
- Aug 28–Sep 2, 2025: CLIA files suit in federal court to block the cruise-fare TAT. Proceedings continue; no injunction reported in effect as of publication. Seatrade Cruise News+1
- Effective date: January 1, 2026. Cruise fares become taxable pro rata while docked in Hawaii. files.hawaii.gov
Featured-snippet target
Q: When does Hawaii’s 11% tax on cruise fares start?
A: January 1, 2026, with the amount prorated by the share of itinerary days docked in Hawaii. files.hawaii.gov
How the tax is calculated (plain-English “calculator”)
Formula:
Taxable Fare Base = Cruise Fare × (Hawaii Dock Days ÷ Total Voyage Days)
State TAT Due = Taxable Fare Base × 11%
County TAT (if adopted) = Taxable Fare Base × 3% (assessed per county of call)
- “Cruise Fare” here means the gross rental proceeds derived from cruise fares (the Department’s term). Lines may define what falls under “fare” vs “fees” consistent with law and their accounting. files.hawaii.gov
- “Hawaii Dock Days” are days your ship is docked in a Hawaii port (including overnights at Maui or Kauaʻi for Pride of America). The Department’s guidance uses days (not hours); if more granular rules appear, lines will adapt. files.hawaii.gov
- County TAT: Hawaii counties are authorized to add 3% to their prorated share (if they adopt/edit rules). Expect your invoice to show state and possibly county components separately. AP News+1
Important: These taxes are separate from port/harbor charges already embedded in your “taxes, fees & port expenses.” The TAT is new and distinct. Courthouse News+1
Real-world examples (numbers you can sanity-check)
Example A — NCL Pride of America (7 nights, all in Hawaii)
- Assume: Cruise fare $1,499 per person; 7 dock days in Hawaii / 7 total days = 100%.
- Taxable Fare Base: $1,499 × 1.00 = $1,499
- State TAT (11%): $1,499 × 0.11 = $164.89
- Possible County TAT (3%): $1,499 × 0.03 = $44.97
- Total Added (state + county, if county applies): $209.86 pp
- Two travelers: $419.72 total added.
Why so high here? Because every day is a Hawaii day; the proration fraction is 1.0.
(NCL has noted its Hawaii guests already face significant port-related charges—~$200 per person cited in industry coverage—but remember, the TAT is separate from those fees.) Seatrade Cruise News
Example B — West Coast–Hawaii–West Coast (15 nights with 3 Hawaii calls)
- Assume: Cruise fare $1,699 per person; 3 Hawaii dock days / 15 days = 0.20.
- Taxable Fare Base: $1,699 × 0.20 = $339.80
- State TAT (11%): $339.80 × 0.11 = $37.38
- If a county adds 3%: $339.80 × 0.03 = $10.19
- Total Added: $47.57 pp (if county applies), $37.38 if not.
Example C — One-way Transpacific with 2 Hawaii days (e.g., Vancouver → Honolulu → South Pacific)
- Assume: Cruise fare $2,199 per person; 2/18 = 0.111…
- Taxable Fare Base: $2,199 × 0.111… ≈ $244.33
- State TAT (11%): ≈ $26.88
- County 3% (if adopted): ≈ $7.33
- Total Added: ≈ $34.21 pp (with county); $26.88 without.
Tip: If your trip includes multiple counties (e.g., Honolulu, Maui, Kauaʻi), the 3% county TAT—if those counties adopt it—would be allocated per county day on your invoice. Expect the cruise line’s breakdown to reflect which county’s surcharge applied on which day. (Watch your line’s notices as county rules are finalized.) AP News+1
Edge cases & “what ifs”
1) I paid my cruise in 2025. Does that exempt me?
Maybe—it depends on the cruise line’s accounting method and the timing of when income is recognized.
- Cash basis: Fares received before Jan 1, 2026 are not subject to the cruise-fare TAT.
- Accrual basis: Look to the “all events” test (right to receive becomes fixed by performance/payment due/payment made—whichever first). If fixed before Jan 1, 2026, the pre-2026 rules apply; if fixed on/after Jan 1, 2026, the 11% cruise-fare TAT applies on the prorated base.
This is spelled out in Announcement 2025-03. Expect each line to interpret consistently with its accounting policies; if in doubt, ask your line or travel advisor for a billing memo. files.hawaii.gov
2) Are gratuities, shore excursions, Wi-Fi, or drinks packages taxed by the new rule?
The Department’s announcement specifically references “gross rental proceeds derived from cruise fares.” It does not enumerate onboard extras. Cruise lines will determine the taxable base consistent with the statute and guidance; watch for invoice line items that show what portion was treated as fare for TAT purposes. files.hawaii.gov
3) Is the new cruise tax already final?
The law is enacted and dated for Jan 1, 2026, and the Department has issued formal guidance. However, CLIA’s lawsuit seeks to block the cruise-fare component. Until a court stays or strikes it, plan for it to apply. files.hawaii.gov+1
4) Do counties already charge the extra 3% for cruises?
As of now, reporting indicates the law authorizes counties to add 3% to the prorated cruise base. Counties have existing County TAT frameworks for land lodgings; final cruise applications, timing, and administration may be set via county rules. Watch announcements in Honolulu (Oʻahu), Maui, Kauaʻi, and Hawaiʻi counties. AP News+1
5) Does this stack on port fees?
Yes. Port fees, harbor dues, security charges, and other port expenses are separate and already embedded in the “taxes/fees/port expenses” you see at booking. The TAT on cruise fares is additional (and new). Courthouse News+1
Who pays (and who doesn’t)
Applies to:
- Cruise ship operators on gross rental proceeds from cruise fares, pro rata for time docked in Hawaii ports (ultra-clear in Announcement 2025-03). files.hawaii.gov
Likely felt by guests:
- Cruise lines routinely pass through taxes; expect to see a line item for Hawaii TAT (and County TAT if applicable) on or before final payment for 2026 sailings with Hawaii calls. (The Department notes rate changes apply regardless of whether a taxpayer “passes on” tax; but in practice, lines do.) files.hawaii.gov
Does not replace:
- Port/harbor charges, pilotage, dockage, and third-party services (tugs, water, stevedoring) that lines pay and itemize separately. Courthouse News
What Pride of America guests should expect
NCL’s Pride of America runs 7-night Hawaii itineraries with every day in the islands (often overnights at Maui and Kauaʻi). On such itineraries, the proration ratio is essentially 1.0 (100%), so the full cruise fare becomes the taxable base for 11% state TAT, plus any county TAT that may be adopted where you call. Industry reporting also underscores that Pride of America guests already face substantial port fees; this new cruise-fare TAT is separate. Seatrade Cruise News
What Princess, Royal Caribbean, Celebrity (and seasonal Hawaiʻi callers) should expect
If you’re booking a longer Pacific voyage that includes just a few Hawaii stops (e.g., two to four calls on a 15–18 night trip), only that fraction of days is taxable. The absolute dollars can still add up for higher-fare cabins, but the percentage of your total fare subject to TAT is much smaller than on Pride of America.
Planning hack: If you’re fare-sensitive, compare itineraries by Hawaii dock-day fraction. A 3/15 itinerary (20%) will incur about one-fifth the Hawaii TAT that a 7/7 Hawaii itinerary would, all else equal.
Will this change again? (Litigation watch)
As of publication, CLIA and allied businesses have sued Hawaii’s officials to block the cruise-fare TAT, arguing constitutional and federal conflicts (including the Tonnage Clause). Newsrooms report the case is in U.S. District Court, Hawaii, with a hearing slated in fall 2025. Until a court intervenes, the law takes effect Jan 1, 2026 and lines will prepare their billing systems accordingly. AP News
Practical steps to take now
- Check your 2026 invoices for Hawaii calls. Look for new line items labeled Hawaii TAT and possibly County TAT. (If you booked and paid early, your line may adjust based on the Department’s cash vs accrual timing rules.) files.hawaii.gov
- Budget add-ons beyond the fare: port fees, gratuities, and drinks packages (run the math with our Drinks + Gratuities Calculator).
- Ports/overnights strategy: If your ship overnights (e.g., Maui or Kauaʻi), consider shore tours that maximize value on those long calls—and look at island Wi-Fi/eSIM for staying connected (a good alternative to ship Wi-Fi while in port).
- Planning Europe too? Carbon costs are evolving there as well—see our EU ETS (2025–26) guide.
- Mobility needs? Tender vs dock can change how you explore—check our Bahamas tender vs dock accessibility guide for general tips that also apply to tender ports worldwide.
FAQs
Does this stack on port fees?
Yes. The cruise-fare TAT is in addition to port and harbor charges. Industry and court filings note substantial, separate port-related expenses; the TAT does not replace them. Courthouse News+1
How is proration computed?
The Department of Taxation says the TAT on cruise fares is “prorated according to the ratio of the ship’s days docked in State ports to the duration of the total voyage.” files.hawaii.gov
If I paid in 2025, am I exempt?
Under cash-basis accounting, fares received before Jan 1, 2026 are not subject to cruise-fare TAT. Under accrual, apply the all-events test to when the right to receive is fixed. Ask your line which accounting method they use for guest receipts. files.hawaii.gov
Is the law being challenged?
Yes. CLIA has sued to block the cruise-fare portion. As of now, Jan 1, 2026 remains the stated start date pending the case outcome. Seatrade Cruise News+1
Will counties also charge their 3%?
The law authorizes a 3% county TAT on the same prorated base, but counties set their own rules. Watch for county notices as 2026 approaches. AP News+1
