Thriving on tourism, Hawaii relies on visitors from around the world to bolster the state’s economy. Hotels are the main beneficiaries, having a steady flow of customers throughout the year.

Governor Neil Abercrombie has submitted a bill to raise the room tax in hotel rooms throughout the state. Known as the Transient Accommodations Tax (TAT), this would be the third hike in the last four years. 

Though the tax would provide another source of income for state finances, the negative influence on local industry outweighs the positive. Hawaii would have to maintain tourism and marketing with an increased price on vacation necessities, such as hotels.

Tourism is currently booming, bringing in a record eight million visitors in the past year. Dependence on this single industry is dangerous, however, and a lull in visitation leaves Hawaii struggling to thrive. It is imperative that the government explore alternate solutions to diversify the economy, making self-sustenance possible.

A decrease in profits is a real possibility with the higher tax, discouraging visitors from vacationing and spending their money in Hawaii. It would also negatively influence the advancements our state has made in the economy.

Depending on profits from visitors to the islands, Hawaii requires a consistent flow of income. By again raising the cost of vacation, the state economy will suffer. The need to reduce or maintain tax levels is required. The state must also diversify its economy for more predictable outcomes.