Tourism leaders relieved as bill dies

By Michele Kayal
Advertiser Staff Writer

Hawai'i narrowly avoided what some tourism leaders predicted would be a major blow to the state's $10 billion visitor industry when the Legislature abandoned a new tax on package tour operators.

The Japan Hawai'i Travel Association, which represents Japanese tour operators such as Japan Travel Bureau, predicted that the attempt to tack a $7.25-per-night surcharge on every room bought by wholesalers would cost its members 25 percent of their business, or 450,000 fewer visitors. Several of Hawai'i's largest package companies protested and the United States Tour Operators Association said the tax would make Hawai'i the only destination in the world with such a fee.

"They would be forced to drop Hawai'i for other destinations," the group said of many of its members.

Lawmakers abandoned House Bill 1589 just before the deadline to send it to the floor.

Several bills that would have audited the Hawai'i Tourism Authority and abolished it in 2003 also failed to make it out of conference committees.

The cruise industry, on the other hand, saw two of its bills pass. Senate Bill 752 would clear the way for restaurants and other visitor amenities to lease facilities at the state's small boat harbors. Senate Bill 755 would allow private entities, such as the cruise lines, to advance the state up to $2 million for harbor facility public improvements without prior consent of the Legislature.

The companies can advance up to $5 million to the state, but the Legislature must approve those transactions.

Both must be signed by the governor to take effect.