State-by-State Guide to Taxes on Middle-Class Families
Tool | November 2020

Hawaii State Tax Guide for Middle-Class Families

State tax rates and rules for income, sales, gas, property, cigarette, and other taxes that impact middle-class families.

Hawaii

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The Bottom Line
Flag of Hawaii

Tax-Friendly

The Aloha State does things differently than the mainland, taxes included. Let's start with Hawaii's sales tax. Since it's due on virtually all transactions, the pocketbook effect is far more severe than the rate would suggest. Income taxes are relatively high, too with a whopping 11% top rate. A ray of sunshine: Property taxes as a percentage of home value are the lowest in the U.S.

Income Tax Range

Low: 1.4% (on taxable income up to $4,800 for married couples filing jointly; on up to $2,400 for married couples filing separately and individual filers)

High: 11% (on taxable income over $400,000 for married couples filing jointly and surviving spouses; on over $200,000 for married couples filing separately and individual filers)

Sales Tax

4% state levy. Localities can add as much as 0.5%, but the average combined rate is only 4.44%, according to the Tax Foundation.

Groceries: Taxable
Clothing: Taxable
Motor Vehicles: Taxable
Prescription Drugs: Exempt

Real Property Taxes

In Hawaii, the median property tax rate is $280 per $100,000 of assessed home value. That's the lowest statewide rate in the nation.

Motor Fuel Taxes

Gasoline: 50.17¢ per gallon (varies by county).
Diesel: 50.81¢ per gallon (varies by county).

Sin Taxes

Cigarettes and little cigars: $3.20 per pack
Large cigars: 50% of the wholesale price
Other tobacco products: 70% of the wholesale price

Beer: $0.93 per gallon
Wine: $1.38 per gallon ($2.12 if sparkling)
Liquor: $5.98 per gallon

Annual Car Taxes and Fees

An annual vehicle registration fee based on the car's weight and usage is imposed.

Estate and Inheritance Taxes

Hawaii imposes an estate tax on estates worth $5.49 million or more. Tax rates range from 10% to 20%.


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