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Facts & Figures - Hawaii

Property taxes for the state of Hawaii.

The Aloha State bases its property taxes on the county level and assigns an assessed value for real property, land, and improvements made to a standing structure. Assessments are made according to 100% of the fair market value. Automobiles and boats are not taxed.

What’s neat about Hawaii is the way in which its municipal governments are organized. Other than Honolulu County, there are no incorporated cities, which mean that there are no levels of formal government (i.e. the city) below the county government. This ultimately affects tax rates because you, as a taxpayer, will not have to pay city taxes. The five counties are:

  • Hawaii
  • Maui
  • Kalawao
  • Honolulu
  • Kauai

Although real estate prices and therefore valuations for property taxes are high in Hawaii, the rates are actually very low when compared to those of the mainland. The reason for this is that local governments in Hawaii do not provide the same number of services than those of mainland states do. For example, education, health, and welfare services are taken care of by the state, whereas these responsibilities would fall into the hands of local governments in the mainland.

If you’ve noticed a pattern so far, taxes in the West tend to be lower than taxes in the eastern part of the country (e.g. Connecticut) because the eastern, or older, states were “raised” on real property taxes that were used to fund local governments. Also, when the Great Depression hit in the 1920s and 1930s, causing nationwide foreclosures and bankruptcies, local governments looked for additional ways to fund programs such as education and safety.

These taxes and forms of government are largely a result of the past and are still functioning to this day. Yet, Hawaii has one of the nation’s lowest property tax states, averaging roughly $17.50 per $1,000 in 2004. Maine, by comparison, averaged $54.81 per $1,000 in 2004!

Homestead exemption is $12,000 but $40,000 in the city and county of Honolulu. Persons between 60-69 years old may claim two times the exemption amount, and a person 70 or older may claim 2.5 times the exemption. In the city of Honolulu, however, the breakdown is this:

  • 55-59 years – 1.5 times the exemption
  • 60-64 years – 2 times
  • 65-69years – 2.5 times
  • 70 and older – 3 times

Homeowners 55 and over may receive an exemption anywhere between $60,000 and $120,000 (depending on age of owner) of the property’s assessed value, regardless of income. ($100 in taxes must be paid, though.)

State of Hawaii Department of Taxation learn more.



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