Maui County scrambles to institute new hotel room tax, but not everyone is on board

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Published: Jul. 8, 2021 at 6:07 PM HST|Updated: Jul. 9, 2021 at 10:32 AM HST
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KAHULUI (HawaiiNewsNow) - Maui County officials are rushing to impose new visitor accommodations taxes after the state Legislature overrode a veto by the governor this week.

“This will help tremendously,” said Maui County Council Chair Alice Lee.

Until now, counties have relied on the Legislature to pass on a portion of the 10% state hotel room tax.

Under the new law, the state will keep the tax funds but allow counties to collect another 3% and keep it for themselves.

Lee said that will bring Maui nearly triple the revenue.

“Instead of $23 million, we’ll probably receive in the neighborhood of $50 to $70 million,” Lee said.

State Rep. and House Finance Chair Sylvia Luke said under the old system, Oahu got the most money because of its larger population. Now the counties will be paid based on how many visitors stay there.

Luke said it is long overdue and Maui stands to benefit the most from the new system.

“The island is just overrun with tourists,” said Luke. “And you look at the population of Maui, compared to Oahu, there’s a lot more tourists per capita.”

Lee wants it in effect immediately.

“As soon as we can. The administration, the budget office, our budget director, and our corporation counsel are working on this this very minute,” she said. “We will expedite it and get the in motion as quickly as possible … because this is a lot of money which we need badly.”

Lee said she wants to see the money go toward infrastructure improvements, like roads and water treatment plants, and affordable housing.

Maui County Mayor Mike Victorino has also voiced support.

But local hotel leaders have said that now is not the time to impose another tax. And idea, unsurprisingly, isn’t popular with visitors either.

Phil and Diana Asenas, who are visiting from California, said boosting prices isn’t fair.

“Taking a little bit of an advantage of people who truly want to get out and have been locked down for two years now,” said Phil.

“They’re definitely taking advantage of us,” Diana Asenas said. “But at the same time, if we want a vacation, we have to suck it up too. But it’s not right. It’s definitely not right.”

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