Here are some questions that many folks across the USA should be able to answer: When is tax day? As in when are your taxes due? Or, what does April 15th mean to you?
Yes, April 15 is coming right up. As you can imagine, there is nothing simple or uncomplicated when talking about taxes.
Surprisingly, the simplest information about the bad news about taxes in Hawaii comes from the state Tax Department (https://tax. hawaii.gov/blog/blog14-comparing-hawaii-income-taxes Opens in a new tab).
“Hawaii has one of the highest income tax burdens of any state for all income levels,” the department’s post says.
Most taxpaying local residents can agree with that. When it comes to how much each state collects in state taxes, Hawaii is usually near the top.
“The state ranks between first and the third place for highest income tax burden for every income level,” according to a report comparing Hawaii’s income tax burden to other states.
“Hawaii has the highest tax burden for very high-income taxpayers making over $500,000 filing single and $1,000,000 filing jointly,” the report says.
State tax officials warn, however, that comparing one state to another is not a “straight-forward exercise.”
Before doing a comparison between Hawaii and another state’s taxes, officials say don’t forget to factor in “marginal tax rates, standard deduction, personal exemption, and income-based tax credits. And furthermore, tax burdens tend to vary by income level.”
If you look at the big picture, Hawaii in 2024 is ranked nationally No. 2, collecting $7,070 on a per capita basis.
To complicate the comparison just a tad, looking at taxes by date, for 2023, “states with high income tax rates include California at 13.3%, Hawaii at 11%, and New York at 10.9%, with several others not far behind,” report the folks at Intuit, makers of TurboTax.
The Tax Foundation warned that “Hawaii significantly revised its individual income tax brackets,” so the comparisons are not 100% accurate right now.
The foundation adds to the cautions, saying, “Hawaii still has one of the most complex bracket structures in the nation, with 12 brackets. Brackets will be further widened in 2027, with additional increases to the standard deduction phased in over several years.”
Hawaii is where state taxes go to live and flourish. Hawaii, for instance, has a name for every possible way to force you to hand over your money.
We have an individual income tax, corporate income tax, state sales tax, property tax, gas tax, cigarette, tobacco and liquor tax, fuel tax, public service company tax, rental vehicle, motor vehicle and car-sharing vehicle tax, and the transient accommodations tax.
State officials will note that both Gov. Josh Green and the Legislature combined last year to pass a new state tax plan that they say will “significantly reduce Hawaii’s individual income tax liability for everyone in the state.”
It is being called the largest tax cut in the state’s history.
I would say to slow up on the praise. Give the taxpayers a few annual tax days before declaring this a public holiday.
The state’s real or just desired need for more money is difficult to balance against the public’s desire to not pay more taxes, but this is the time when less tax can result in more benefit to the state.
