The Hawaiʻi State Senate passed a bill on March 9 that aims to generate additional state revenue through a number of different tax and rate increases.
SB 56, which was introduced by Senator Stanley Chang (District 9 – Hawai‘i Kai, Kuli‘ou‘ou, Niu, ‘Āina Haina, Wai‘alae-Kahala and Diamond Head) would:
- Impose a 16% tax on individuals earning more than $200,000 a year, up from the current rate of 11%.
- Increase the capital gains rate from 7.25 percent to 11 percent.
- Impose a single rate for the corporate income tax at 9.6 percent.
- Repeal certain GET exemptions from July 1, 2021 until June 30, 2023.
- Increase conveyance taxes for the sale of properties valued from $1,000,000 to $2M to 0.6%; from $2M to $4M to 1.0%; etc. The highest bracket that conveyance taxes will raise is $10M and above to 2.0%.
“With a budget shortfall of over $2 billion, we need to look at various ways to generate much needed revenue for our State,” said Sen. Chang. “In order to avoid future furloughs and layoffs for State workers, we need to consider every option to prevent disruptions to essential government services.
The measure passed third reading in the Senate today and will advance to the State House of Representatives for consideration.