Last it was Maui that enacted an additional 3% accommodations tax effective November 1. Maui’s County Council had introduced the bill that was then signed into law by Mayor Victorino. Kauai also approved and implemented a 3% tax hike on accommodations. But now it is Honolulu’s turn.
Honolulu just added 3% to other accommodation taxes.
The bill to add the new 3% tax on all visitor accommodations was approved by the County Council last week. That will be added to the state’s current accommodation tax of 10.25% and the Honolulu GST tax of 4.5%.
A similar bill implementing an additional 3% accommodations tax is going through the Hawaii Island County Council and is expected to pass.
HB862 tax bill created additional taxes.
Hawaii’s legislature kicked off these increases via HB 862. That measure went into effect starting October 1. As a result, the state now has the highest combined accommodation tax in the US. Kauai was the first county to adopt this increase.
In July, the legislature approved the accommodation taxes and funding for the troubled Hawaii Tourism Authority (HTA). These taxes are a significant source of revenue for all the islands and are applied to both your Hawaii vacation rental and Hawaii hotel stays.
Governor Ige initially vetoed the bill designed to halt funding for Hawaii Tourism Authority via accommodation taxes. The legislature feels strongly, given they then overrode the governor and want to fund HTA via its general fund to provide better checks and balances.
We aren’t convinced about HTA’s abilities no matter how it is funded, given a checkered past and not enough to show for the money it has received. See much more on that below.
Each island will tax visitors independently.
For years, the counties have received an allotment of the statewide uniform 10.25% accommodations tax rate, but that will now come to an end. Instead, each county will add its surcharge to that existing statewide tax.
Statewide, Hawaii has the highest combined tax rate in the US.
Our current state accommodations tax is 10.25%. However, with that entire amount going to the state, nothing will be shared with the counties. That is expected to cost the islands over $100 million annually in lost revenue.
The counties are implementing their own charge of 3%, which brings the total accommodation tax to 13.25%, up 29% over the previous rate. That plus 4.17% GST on Maui and 4.712% GST elsewhere in Hawaii. The combined tax on hotels and vacation rentals is to be approximately 18%.
Thus, Hawaii is set to have the highest overall tax on accommodations in the US., according to the National Conference of State Legislatures.
Does the latest tax increase in Honolulu impact you?
Updated 12/6/21.
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Teri G. says
Thankfully, we are able to use the Hale Koa and KMC. No tax. We will shop in military exchanges and commissaries. Also, no tax.
Starla G says
The way it sounds after our trip in a few weeks the Hale Koa and Bellows maybe the only way I’ll go.
Gloria G says
Additional Hotel Tax + an Impact Tax … what next a tax to go into the Ocean? I know that is supercilious but honestly charged $400+ a day and then 18% on top of that, seems like it is harder and harder to find the Aloha.
JC says
Quality over quantity. Sounds like a win to me! Can’t even get groceries at many places anymore because the extreme over tourism problem and we are having water shortages all over as well. No more taking an hour and a half to go just eight miles and having to deal with so much disrespect by the people not following signs or obeying the rules and disrespect of the Hawaiian culture. Less damage to our reefs and people bothering wildlife in violation of federal law which many don’t care about obviously. I wish I could like a thousand times every comment here with people saying they aren’t coming here anymore. That’s the point.
PL says
What are the people who work for the hotels, tour companies, restaurants, small businesses, etc. supposed to do for income if no one vacations on the islands? It’s not just some tourists that discrespect the land, culture, wildlife, reefs, etc. as many locals do also.
G says
With the clear app you can show proof of the vaccine
do you still have to use the safe travels website too
Thank
You
Beat of Hawaii says
Hi Greg.
Yes, you do. We provided that information here: https://beatofhawaii.com/many-new-hawaii-testing-options-easier-vaccine-verification/.
Aloha.
Michael K says
this is , without a doubt , the straw that broke the camels back.we , my wife and myself , both agree that the islands need no funding to attract tourism. between the outrageous car rental costs and the visitor taxes ( which are another rip-off), you will not see our faces again
Charlene E says
With the increase, I think people will not be able to afford it for families. Too bad, it’s a special place to visit.
Jeri J. says
I purchased my first Hawaii timeshares in 2000. I subsequently purchased more. There were no fees to the State of Hawaii to use these deeded interests. Many years ago, they started charging a daily “fee” due to the State of Hawaii even though I am a deeded owner and theoretically pay property taxes. Now this large increase in the “fee”. I am not sure how this is legal as it is paid only by “tourists” and not a part of property taxes which my interests are subject to I was content to just pay it in past years out of my love for these islands even though I did not think it made legal sense. I will now pursue an explanation as to how they can “tax” hotel “guests” and “owners” the same fee.
Amy P. says
New Hawaii resident here that has learned a lot about it that I hadn’t considered as a visitor before. Before complaining about: 1. increased taxes, 2. limited availability of lodging/cars/food/recreation, please consider that we’re all returning from a pandemic and sometimes struggling. During that time it became more apparent what is/isn’t working related to tourism here. Also, as an island there are many things here that aren’t experienced any where else in the United States. I am pretty bothered by many comments on this post, and sad that so many don’t understand the unique issues Hawaiians face that warrant a different approach. I hope you’ll all take some time to study up on Hawaiian history, read about local issues, and understand that aloha goes both ways. And I hope that you Beat of Hawaii might encourage the same of your readers in upcoming posts. Mahalo.
Jeri J says
Hawaii government made a DECISION to become a state completely dependent on tourism. All agricultural and other businesses gone. Did not think it made sense then and was a seriously poor decision. This is the consequence of putting all of your eggs in one basket.
MaryAnn M says
TAX TO FUND THE CONSTRUCTION OF THE CONVENTION CENTER
1986 Act 340 5% Temporary
1994 SLH1993 6% Temporary
1999 Act 156 7.25% Temporary
2009 Act 61, SLH2009 8.25% Temporary
2010 9.25% Temporary
2013 SLH 2013 9.25% PERMANENT*
*Changed allocations of TAT from percentage (%)
To a specific dollar amount.
2017 SLH2017 10.25%
Pete R says
From the article:
“The state’s tourism has suffered a multitude of severe problems for years”.
What problems? Can someone in the know please inform/describe what these problems are/were?
Also, Does Hawaii have a problem attracting tourists? And if so, how will making tourism more expensive attract more tourist dollars? 🤷♂️
Thank you
Beat of Hawaii says
Hi Pete.
A number of major issues with HTA are already listed in the article. Feel free to Google for them as well. Attracting visitors is not so much a need as is management and communications related to tourism.
Aloha.
Jeff M says
Anyone have an idea when the increase in taxes will begin?
Chris W says
Oct 1, 2021
MerryD says
More importantly, does anyone have an idea of where the taxes will be distributed?
Greg M says
No, no one has a clue!! Just like the millions and millions of $$ that the article says was spent/used/siphoned for years, so now we’ll just come up with more taxes on the tourists to recoup that money. My questions are:
1) If you truly don’t want tourists to come why have a tourism authority?!?
2) So you decide to increase, or make a new tax for each island of roughly 3% but 25% of the people elect to not come did you really gain any additional tax $$$?!?
Things that make you go hmmmmm
Gloria G. says
I didn’t say I couldn’t afford the taxes, but if I’m paying out more money, I need to cut somewhere else … local purchases … local restaurants, etc. Vacation budgets aren’t unlimited. Hawaii is expensive. Where else would you pay $40 for a piece of fish that comes right out of the ocean … it doesn’t travel … not on a plane or a ship. We come because the Islands call us and we enjoy them. But this is just not right. Your government isn’t being fiscally responsible!
Edward H says
They seem to forget to mention the loss they will incur because of this increase. Some people will now go to a area that cost less. Not everyone can afford these new rates. Instead of welcoming visitors they are saying we don’t want you here. Some people wait their whole life to be able to vacation in Hawaii now with new costs they cannot ever see a place they dreamed about. Thanks for nothing greedy people.
Randy says
Good points all, wonder why no one complained when BHO took two Planes for Christmas every year, then the Security entourage, Press Corp., in 2012 the Locals were complaining about the traffic on the Pali Highway when he dragged everyone in for dinner in Waikiki, Barack and Michelle took Vacation literally, “lock, stock and barrel”, for 8 years all the charges went back to the U.S. Taxpayer for two weeks in Hawaii!
TJ says
Good point Randy! Spot on!
Matt V says
Goodness, why make a political comment here? We could all go down that rabbit hole about how politicians travel, but that’s not the point of this post.
I’m not surprised by the increasing tourist taxes, but I am disappointed.
bill m says
Pertinent because BO was from Hawaii and vacationed here numerous times
Cindy R says
Obama paid for his rental homes. We didn’t, for the record.
Other expenses are those covered for all other presidents in office. Those are Federal standards and have nothing to do with Hawaii State except for extra police escorts.
Randy says
The point is, Obama didn’t have a Home, in Hawaii, he came from Illinois and Chicago Politically, and has never returned save for Musuem Funding Visits etc., not in 13 years! Every other President went home, whether it was Texas, California, Maine to a personal residence, for rest, no large contingents, Special Ambulance and Dr.’s, extended SS Detail. The Clinton’s persona non grata in Arkansas, were living off the largesse of others in Martha’s Vinyard, The Hamptons until they invested in Chappaqua, so Hillary could run for the Senate Seat that was to be JFK Jr.’s! The old ‘Robin Masters Estate’ (Waimanalo) rumored to being purchased by a friend for them, was mentioned, but I believe they we’re on the Marine Base in Kaneohe, using the beaches in Kailua-Lanikai. Whether Alan Wong’s or other Waikiki Hotspots, they took over for 30 days, and the Pali was an issue.
Cindy says
Obama was born and raised in Hawaii and was a Punahou graduate. His grandmother was a very well respected executive at Bank of Hawaii. His childhood friends mostly live there and when he goes back he spends quite a bit of time with them. That is where he came from. He was not born and raised in Chicago. He ended up there and spend time there politically but that is not his home. So, just like all the other presidents, he went “home” which was in Hawaii.
Randy says
A gypsy life no doubt, Washington State, Cambridge Massachusetts, Indonesia before heading to the Mainland and Occidental, never returning to Hawaii again until President! My point was ‘Vacation” he took literally as something paid for by others over those 8 years, other Presidents returned to homes they owned as a respite from the job at Christmas of whenever, incurring no aditional cost to the Taxpayer, past Air Force One to their home, be it in Texas, California, Maine, where-ever, it was not like being awarded a 2 Week Paid Vacation, All Expenses Paid………by Taxpayers!
Kathy D says
The HTA and Hawaii are in a sad state of affairs and sounds like it’s going to get worse. Only the elite vaccinated are welcomed to travel to Hawaii. I have my memories.
Linda F says
We’ve been coming to Hawaii every 2 – 3 years for many years. It sounds like you don’t want visitors coming anymore so we will probably not be back with all the taxes & rate increases . There is many other places to visit that will welcome visitors. We loved visiting the islands & met so many wonderful people.
Peggy M says
Since taxes are but a fraction of the cost of a trip to Hawaii this will not deter me in the future.
Mexico and Florida are options for those that have decided they don’t want to visit. Mexico has its charms but it’s not Hawaii…and you can keep Florida.
Dennis B says
You can raise the tourist tax as high as you want. Basic supply and demand and availability of alternate cheaper vacation destinations will determine where people will spend their money. Hawaii currently has a monopoly on the tourist business due to Covid 19, but that will soon come to an end. They will tax themselves out of business. Best of luck to them as my post Covid trip will not include Hawaii.
sean says
I’m curious….
Is there any other State complaining about increased tourism, restaurant wait times, increased economic activity, or beach parking?
Last I checked, no other Tstae is complaining about their airports not being able to handle people. You go into any other airport in the country…. fully open.. go into Honolulu and you can barely find food.
Good ole Hawaii.. Can’t just act normal. The State has to create its own self inflicted drama.
Colleen says
I agree
Amy P. says
Is any other state made up of islands, Sean? Please read up on the impacts of tourism here, perhaps also some history of the state and come back when you’ve got some compassion. Aloha.
sean says
Was just on a tourist ” island” on the mainland tonight. Much smaller than any island in Hawaii. Nothing but happy smiling faces, even with the traffic and packed parking lots. I’ll add, getting a table in the packed restaurant was quick and easy. That pesky 6ft distancing really sucks huh?
It’s not 1903 anymore. Give up the stolen lands, white devil rhetoric. Hawaiian became a State what, 60yrs ago? Deal with it. Or be mad at your grandparents for voting in whatever gov’t that accepted Statehood.
The State has nothing in terms of manufacturing, tech.,or agriculture to offer in any meaningful volume.
The State has a natural beauty that attracts visitors. Tourists want to lay on the beach, stay at resorts and see some sights. They certainly aren’t the ones leaving the trash on the sides of the roads. Unless they bought a used car and burnt it out before leaving?
I’d much prefer Hawaii to end Statehood. Then the people will have a whole new set of problems to complain about.
When I see a society cutting off its nose over beach parking and some traffic, after year of side of the road food drives, compassion isn’t warranted.
Randy says
Sean, I think you’re on to something, poor planning by HT, poor response by State, now making re-employment contingent on Vaccination, the early signs were in Maui and Kauai with Mayor’s bringing up negatives to Tourism, they now claim to have the lowest cost increase in Construction, on this Islands that everything has to be shipped in to. Again, this is Business not Politic’s, but how State Government handled the same problem that the other 49 States has Hawaii with NY, Illinois and California, that locked-down and “killed” Tourism.
sean says
I’m pretty sure, from articles I’ve read, that many Caribbean Islands were ecstatic to have tourists back..
Go figure. They know the value of a buck and must not be big on govt handouts from that pesky USA
Ben T says
I live in Alaska. Tourism is a big part of our economy just like Hawaii. We don’t feel the need to over tax our visitors after the pandemic. There are other places tourist can go. The Bahamas and Mexico are rolling out the red carpet for post pandemic tourist. Don’t punish your guest because your tourism industry had poor planning pre pandemic.
Chris R says
I am currently in Southeast Alaska. It is made up of chains of Islands also with limited resources. I lived on Oahu from 2019 until May of 2021 and from what I see, the resources are managed better here than they were in Hawaii.
Brett says
We love Hawaii, but at some point the price difference between a flight to Hawaii and a flight to French Polynesia is going to be made up by these taxes. We’ll just go there,it’s less crowded anyway.
Jeff says
From what I’ve read on your site lately the locals don’t want us anymore and the government thinks all tourist are millionaires. We’re coming in August to late to cancel without penalty. If both groups pay me back for my timeshare, I promise to never come back again.
TJ says
Being that the various counties in Hawaii are now complaining about having too many visitors, why does Hawaii even nee a department to promote tourism? Doesn’t make any sense to me. Maui has gone so far as to consider limiting visitors onto that island. Why then does the state need more money for the department of tourism?
Mahalo,
TJ
Beat of Hawaii says
Hi TJ.
Any tourism destination needs a marketing arm. In large part that is to facilitate coordinated communication. Management of tourism is another goal.
Aloha.
Mark M. says
I know there are pros and cons to everything being said on this site. That being said, I think most people will agree that the State of Hawaii has been poorly run for many years now. Look at Chicago and Los Angeles. Local government has failed both cities, with out of control shootings in Chicago and trash and filth and homeless crisis still not being addressed in LA. I tend to agree that maybe Hawaii need to limit tourism to a certain degree but they need to work on promoting locally grown foods and other businesses and technology. I hate to say it, but here on the mainland, we may need to put limits on the number of visitors to parks like Zion, Yosemite, and the Grand Canyon. These parks are being trampled by too many visitors which impacts the land and the ability to preserve the land for people to enjoy. Its not popular, but if Hawaii feels they need to put limits on tourism to preserve the land for the future, so be it.