Hawaii Sales Tax Guide

Did you know that Hawaii’s sales tax system is unique in the United States? Unlike other states that impose a traditional sales tax, Hawaii operates on a general excise tax (GET), which applies to nearly all business activities, including retail sales, services, and rentals. 

This guide is here to help you understand Hawaii’s general excise tax system. From determining if you need a tax permit to understanding exemptions and calculating rates, we’ll cover it all. 

By following our comprehensive guide, you’ll learn how to comply with Hawaii’s GET requirements and avoid any costly mistakes. So, let’s dive in and ensure your business remains profitable and compliant in the Aloha State.

Section 1: Determining Hawaii Sales Tax Nexus

Do You Need a Sales Tax Permit to Sell Online From or To Hawaii?

No, you do not need a sales tax permit to sell online from or to Hawaii. Hawaii does not have a traditional sales tax system. Instead, it imposes a General Excise Tax (GET) on all business activities, including retail sales. If you are selling online and have a significant connection, or nexus, with Hawaii, you will need to register for a GET account and collect and remit the tax on your sales. However, if you do not have a significant connection to Hawaii, you are not required to collect or remit GET on your sales.

To determine if you have a significant connection to Hawaii, you will need to consider factors such as whether you have a physical presence in the state, whether you have employees located in the state, or whether you have a substantial number of customers located there.

What Triggers or Creates a Sales Tax Nexus in Hawaii?

A sales tax nexus in Hawaii is a connection that requires a business to collect and remit sales tax to the state. This connection can be established through various means, including physical presence and economic activity.

Physical Presence can trigger a nexus. Having employees working in Hawaii, even temporarily, can create a connection. Similarly, storing inventory, maintaining an office, or even having a virtual office in the state can establish a nexus.

Economic Activity can also lead to a nexus. Exceeding a specific sales threshold to Hawaii residents or businesses may require a business to collect and remit sales tax. Additionally, having affiliates or subsidiaries operating in Hawaii can trigger a nexus.

Finally, click-and-collect services can create a nexus if a business allows customers to order online and pick up their purchases at a physical location in Hawaii.

What is Hawaii’s Sales Tax Economic Nexus Threshold?

The Hawaii’s Sales Tax Economic Nexus Threshold is $100,000 or more in gross sales from Hawaii customers within a calendar year, or 200 or more separate transactions with Hawaii customers within a calendar year. This means that if your business exceeds either of these thresholds in the current or previous calendar year, you are required to register for and remit the General Excise Tax (GET)​.

Hawaii Sales Tax Nexus Requirements

The law in Hawaii requires businesses to register for a General Excise Tax (GET) number if they meet the nexus requirements. Businesses that have nexus in Hawaii are required to collect and remit GET on retail sales at a rate of 4%, with possible additional local rates up to 0.5%. Businesses must also file regular GET returns and remit the collected tax to the state.

Hawaii Sales Tax Nexus Calculator

To determine if you have met the nexus threshold in Hawaii, consider using online tools and resources provided by tax compliance services such as AtomicTax. These tools can help you calculate your gross sales and transaction counts to ensure you meet Hawaii’s nexus requirements​.

Read: The Ultimate Guide to Managing Sales Tax Compliance for Every State in The US

Step 2: Understanding Sales Taxability Exemptions and Resale Certificates in Hawaii

Who Qualifies for Sales Tax Exemption in Hawaii?

In Hawaii, the General Excise Tax (GET) is primarily imposed on businesses, not consumers. This means that there aren’t typically exemptions based on an individual’s tax status. However, there are a few exceptions:

Businesses:

• Wholesalers: Businesses that sell products to other retailers for resale are generally exempt from GET.
• Government and Credit Unions: Sales to the federal government or credit unions may qualify for a GET deduction.

Goods:

• Food Stamps: Purchases made using SNAP benefits are exempt from GET.
• Medical Supplies: Prescription drugs and medical supplies are typically exempt from GET. 

What is a Hawaii Sales Tax Exemption Certificate?

A Hawaii Sales Tax Exemption Certificate (Form G-17) is a document that businesses use to prove that their purchases are exempt from the General Excise Tax (GET). This allows businesses to buy goods without paying GET if they intend to resell those goods.

To be eligible for a sales tax exemption, businesses must provide their sellers with a completed Form G-17. This form typically includes information about the business, the nature of the purchase, and the intended resale activity. By presenting a valid exemption certificate, businesses can avoid paying GET on eligible purchases, which can help to reduce their overall tax burden.

Hawaii Sales Tax Exemption Rules

Understanding and complying with Hawaii’s sales tax exemption rules is essential for businesses. Here are some key points:

• Documentation: Sellers must keep a copy of the exemption certificate provided by the buyer.
• Verification: It is the seller’s responsibility to verify that the certificate is correctly filled out and valid.
• Record-Keeping: Accurate records of exempt transactions must be maintained.
• Specific Use: Exemption certificates are only valid for the specific types of transactions mentioned on the form.

What Goods Are Taxable in Hawaii?

Hawaii operates under a General Excise Tax (GET) system rather than a traditional sales tax. Under this system, nearly all goods sold within the state are subject to taxation. Here’s a detailed overview of what goods are taxable:

Tangible Personal Property

Most tangible goods sold to consumers in Hawaii are subject to the GET. This includes:

• Clothing: Whether purchased in-store or online, clothing items are taxable.
• Electronics: Products like computers, phones, and televisions are subject to the GET.
• Furniture: All types of furniture, including home and office items, are taxed.
• Books and Periodicals: This includes physical books, magazines, and newspapers.
• Vehicles: Motor vehicles, including cars and motorcycles, are taxable, though some occasional sales might be exempt.

Grocery Items

Even everyday grocery items are not exempt under Hawaii’s GET system:

• General Grocery Food: Unlike in some states where food is exempt, Hawaii taxes grocery food items.
• Prepared Meals and Catering: Ready-to-eat foods, including meals from restaurants or catering services, are also subject to the GET.

Medical Goods

While most goods are taxable, there are specific exemptions:

• Medical Devices: Certain medical devices may be exempt, particularly those prescribed by a healthcare provider.
• Medicines: Over-the-counter and prescription medicines are generally taxable unless specifically exempt under certain conditions.

Utilities and Fuel

Utilities and fuel, which are essential for daily living, are also subject to taxation:

• Utilities: Electricity, water, and other utilities are taxable under the GET.
• Fuel: Gasoline and other fuels used for vehicles and machinery are taxed.

What Services Are Taxable in Hawaii?

Unlike many other states, Hawaii applies GET not just to goods but also to a wide range of services. Services that are generally taxable in Hawaii include:

• Professional Services: Services provided by accountants, architects, attorneys, and other licensed professionals.
• Personal Services: This category includes services like hairdressing, tanning, and personal training.
• Business Services: These include consulting, advertising, payroll, and other services provided to businesses.
• Construction Services: Contracting services, including building, remodeling, and other construction-related activities.
• Leasing and Renting Services: Renting or leasing of personal or real property, such as equipment rentals or property leases.

It’s important to note that different service categories may be subject to different tax rates depending on the specific nature of the service​.

What Is Excluded from Sales Tax in Hawaii (Non-Taxable Items)?

While Hawaii’s General Excise Tax (GET) applies broadly, certain items are exempt:

1. Prescription Drugs and Medical Devices: Medications prescribed by healthcare professionals and specific medical devices are typically exempt​.
2. Sales to Government Agencies: Sales made directly to the federal government are generally exempt from GET​.
3. Nonprofit Transactions: Some sales involving nonprofits, especially for charitable purposes, may be exempt​.
4. Agricultural Products: Certain farming supplies and agricultural products used directly in farming activities are exempt​.
5. Exported Goods: Goods sold for shipment outside Hawaii, including interstate and international sales, are exempt​.

These exemptions help reduce the tax burden on essential goods and services, benefiting specific sectors and ensuring compliance with state regulations. 

How Does a Hawaii Sales Tax Exemption Form Look Like?

The primary form used for claiming sales tax exemptions in Hawaii is Form G-17, the Resale Certificate for Goods. This form allows purchasers to certify that the goods they are buying are intended for resale and, therefore, should be exempt from the General Excise Tax (GET). The form typically includes the following sections:

• Purchaser’s Information: Name, address, and Hawaii Tax Identification Number.
• Seller’s Information: Name and address of the seller.
• Description of Business: Details about the nature of the purchaser’s business.
• Signature Section: Where the purchaser certifies the information provided is accurate and signs the form.

This form needs to be completed accurately and presented to the seller at the time of purchase. It’s a standard form, and you can typically download it directly from the Hawaii Department of Taxation website.

Hawaii Sales Tax Exemption Chart PDF

The Hawaii Department of Taxation provides a detailed chart listing the various exemptions under the GET system. This chart is typically available as a downloadable PDF and includes categories such as prescription drugs, specific agricultural products, and sales to government agencies. It is a valuable resource for businesses to quickly determine which transactions may qualify for an exemption. 

You can find this chart on the Hawaii Department of Taxation’s website, often updated annually to reflect the latest tax laws​.

Out-of-State Sales Tax Exemption in Hawaii

Out-of-state sales in Hawaii can be exempt from the GET if the goods are shipped directly out of state. 

To claim this exemption, you typically need to complete an Export Exemption Certificate. This certificate confirms that the sale is for goods intended to be shipped out of Hawaii and not used within the state. 

Proper documentation, including proof of shipment, must be maintained to support the exemption claim. This process ensures compliance with Hawaii’s tax laws and prevents potential penalties during audits​.

Hawaii Sales Tax Exemption Certificate for Nonprofit

In Hawaii, nonprofit organizations can apply for a General Excise Tax (GET) exemption on specific types of income, known as “exempt function income.” This includes income directly related to the nonprofit’s mission, such as tuition for schools, admission fees for museums, or medical charges for hospitals. To qualify, the nonprofit must register with the Hawaii Department of Taxation using Form G-6. 

This form must be submitted online, and once approved, the organization can report exempt income on their GET returns​.

How to Apply and Get a Hawaii Sales Tax Exemption Certificate

To obtain a sales tax exemption certificate in Hawaii, nonprofits must follow these steps:

Determine Eligibility:

• Business Type: Ensure your business qualifies for a tax exemption. Common exempt businesses include non-profit organizations, government agencies, and certain agricultural operations.
• Purchase Purpose: The items you intend to purchase must be used for exempt purposes.

Gather Required Documentation:

• Business License: Provide proof of your business license or registration.
• Taxpayer Identification Number (TIN): Furnish your federal tax ID (EIN).
• Supporting Documents: Depending on your business type, you may need additional documents, such as articles of incorporation or a charitable organization’s determination letter.

Complete the Application:

• Obtain the Form: Download the appropriate application form from the Hawaii Department of Taxation website.
• Provide Information: Accurately fill out the form, including your business name, address, and contact information.
• Describe Exemptions: Clearly state the reasons for your exemption, citing relevant laws or regulations.
• Pay the One-Time $20 Registration Fee: This fee is required at the time of application.

Submit the Application:

• Mail or Deliver: Submit the completed application and supporting documents to the Hawaii Department of Taxation.
• Electronic Filing: Some jurisdictions may offer online filing options. Check with the department for details.

Await Approval:

• Processing Time: The processing time for applications can vary. Contact the department for estimated timelines.
• Notification: You will typically receive a notification once your application is approved or denied.

Receive the Certificate:

• Issuance: If approved, after submitting the application, it usually takes 5-7 days to receive the Hawaii Tax ID, which is necessary to claim exemptions​.
• Retention: Keep the certificate for your records and present it to vendors when making exempt purchases.

Is a Hawaii Seller’s Permit the Same as a Tax-Exempt Certificate?

No, a Hawaii seller’s permit, also known as a GET license, is not the same as a tax-exempt certificate. A seller’s permit is required for all businesses in Hawaii that sell taxable goods or services, regardless of whether they are a nonprofit or other qualifying organization. It allows the business to collect and remit the General Excise Tax (GET) on their sales.

On the other hand, a tax-exempt certificate is issued to specific nonprofit and other qualifying organizations that are exempt from paying income tax on certain of their activities. This certificate allows them to purchase goods and services without paying sales tax, as long as the purchase is related to their exempt functions.

In summary, a seller’s permit is a general requirement for all businesses in Hawaii, while a tax-exempt certificate is a specific exemption for qualifying nonprofit and other organizations. If you are a nonprofit or other qualifying organization, you will need to obtain both a seller’s permit and a tax-exempt certificate in order to operate legally in Hawaii.

Hawaii Sales Tax Exemption for Manufacturing

In Hawaii, manufacturing-related purchases are generally subject to the General Excise Tax (GET), but certain aspects of the manufacturing process may be eligible for reduced tax rates. Specifically, raw materials sold to licensed manufacturers that are incorporated into a final saleable product are taxed at a lower wholesale rate. 

However, machinery and utilities used in manufacturing do not receive any special exemptions and are taxed at the standard GET rates. Manufacturers should be diligent in documenting these transactions to ensure they are taxed appropriately and take advantage of the lower rates where applicable​.

Hawaii Sales Tax Exemption Certificate Verification and Renewal

Hawaii’s GET license, often referred to as a seller’s permit, does not require periodic renewal. Once you obtain a GET license, it remains valid as long as your business is operational.

However, it’s essential to keep your license information up to date and ensure that your business remains compliant with all filing and payment requirements. If your business ceases operations or if you no longer require the license, you must formally cancel it with the Hawaii Department of Taxation​.

What is the Sales Tax Exemption for Farming in Hawaii?

Farmers in Hawaii benefit from specific exemptions under the GET system, particularly for certain agricultural inputs. Items like seeds, fertilizers, and pesticides can be purchased at the lower wholesale rate, which helps reduce the tax burden on essential farming supplies. 

This exemption is designed to support agricultural activities, and farmers should ensure they are properly licensed and apply for these exemptions when making qualifying purchases​.

What is a Hawaii Resale Certificate?

A Hawaii resale certificate, also known as Form G-17, is a document that allows businesses to purchase goods intended for resale without paying the General Excise Tax (GET) at the time of purchase. 

This certificate is provided to the seller by the buyer, certifying that the purchased goods will be resold, either in their current form or as part of another product. The use of a resale certificate ensures that the tax is only applied when the goods are sold to the final consumer, thus avoiding double taxation. 

Businesses must have a valid Hawaii Tax ID number to use the resale certificate, and it must be properly filled out and presented to the seller at the time of the transaction.

How Much Does a Hawaii Resale Permit Cost?

Obtaining a resale permit in Hawaii is relatively inexpensive. The state charges a one-time fee of $20 to obtain a General Excise Tax (GET) license, which is required to use a resale certificate. 

This license does not need to be renewed, making it a cost-effective option for businesses that need to purchase goods for resale regularly. The $20 fee covers the registration of your business with the Hawaii Department of Taxation, allowing you to legally issue resale certificates to your suppliers​.

How Long Does It Take to Get a HI Resale License?

The time it takes to receive a Hawaii resale license depends on the method of application:

• Online Application: If you apply online through the Hawaii Tax Online portal, you can expect to receive your Hawaii Tax ID and resale certificate in approximately 3-5 business days.
• Mail-In or Walk-In Application: If you choose to apply by mail or in person, the process typically takes 10-15 business days. This timeline includes the processing and issuance of your resale certificate once your application has been reviewed​.

How Do I Get a Resale License Number in Hawaii?

To obtain a resale license number in Hawaii, you need to apply for a General Excise Tax (GET) license, which doubles as your resale license. Here’s how you can get started:

1. Apply Online: Visit the Hawaii Tax Online portal and complete the State of Hawaii Basic Business Application (Form BB-1). This form registers your business for GET and allows you to receive a resale license number.
2. One-Time Fee: The application requires a one-time fee of $20. Once you submit the form and payment, you will receive your Hawaii Tax ID number, which serves as your resale license number.
3. Processing Time: If you apply online, you can expect to receive your license within 3-5 business days. If you apply by mail or in person, it may take 10-15 business days.

Once you have your resale license, you can start purchasing goods for resale without paying GET at the time of purchase​.

How to Verify a Hawaii Sales Tax Resale Certificate

Verifying a Hawaii sales tax resale certificate is crucial to ensure compliance and avoid potential liabilities. Here’s how you can verify one:

1. Check for Completeness: The resale certificate must be fully completed, including the seller’s and purchaser’s names, addresses, and Hawaii Tax ID number. Make sure the description of the purchaser’s business aligns with the items being purchased.
2. Online Verification: You can verify the validity of a resale certificate by visiting the Hawaii Tax Online portal. Use the “Search Tax Licenses” feature to confirm that the Hawaii Tax ID number provided on the certificate is active and matches the business details.
3. Retain Records: As a seller, it is your responsibility to keep a copy of the resale certificate and all related correspondence. This includes any notices of revocation or inapplicability from the purchaser, which should be retained for your records​.

Section 3: Understanding Hawaii Sales Tax Rates

What is the Hawaii Sales Tax Rate?

Hawaii operates under a General Excise Tax (GET) system rather than a traditional sales tax and has a statewide sales tax rate of 4%.

However, local counties can impose additional surcharges, which can raise the effective tax rate to 4.5% in certain areas, such as Honolulu County. 

Unlike other states where sales tax is charged to the consumer, Hawaii’s GET is levied on businesses, but businesses often pass this cost onto consumers in a manner similar to a traditional sales tax.

How to Find or Lookup Your Hawaii Sales Tax Rate

To accurately determine the sales tax rate in any specific area of Hawaii, you can use online sales tax calculators. These tools allow you to input the exact street address to find the applicable tax rate, which can vary slightly depending on the local jurisdiction. 

For example, the rate in Honolulu might be 4.5%, while other counties may charge slightly less. Using an address-specific lookup ensures accuracy, especially in areas where ZIP codes cross multiple tax jurisdictions​.

How to Calculate Hawaii Sales Tax Rate

Calculating the sales tax in Hawaii is straightforward but involves a few key steps:

1. Identify the Base Rate: Start with the statewide base rate of 4%.
2. Add Local Surcharges: Depending on the location, add any applicable local surcharges (up to an additional 0.5%).
3. Apply to Purchase Price: Multiply the total tax rate by the purchase price to find the exact amount of tax.

For example, if you’re purchasing an item in Honolulu with a total cost of $100, and the combined state and local rate is 4.5%, you would calculate the tax as $100 x 4.5% = $4.50.

What City Has the Highest Sales Tax Rate in Hawaii?

In Hawaii, the highest sales tax rate, when considering both the state and local surcharges, is 4.5%. This rate applies uniformly across several cities, including Honolulu, Waipahu, Ewa Beach, Mililani, and Kaneohe. Since the state itself imposes a 4% General Excise Tax (GET), local jurisdictions can add a surcharge of up to 0.5%, which brings the total rate to 4.5%. 

Notably, this rate is consistent across most of the state, meaning there is no single city with a higher rate than others​.

Hawaii Sales Tax by County and ZIP Codes

Hawaii’s sales tax structure is relatively straightforward, with the 4.5% rate applying to all counties within the state.

County Name	Tax Rate	ZIP Codes
Hawaii County	4.5%	96704, 96710, 96719, 96720, 96725, 96727, 96740, 96743, 96749, 96750, 96755, 96760, 96771, 96772, 96773, 96774, 96776, 96778, 96780, 96781, 96783, 96785, 96788
Honolulu County	4.5%	96801-96850, 96701-96797, 96706, 96707, 96709, 96712, 96717, 96730, 96734, 96744, 96762, 96782, 96786, 96791, 96792, 96795, 96853-96863
Kalawao County	4.5%	96742
Kauai County	4.5%	96703, 96705, 96714, 96715, 96716, 96722, 96741, 96746, 96747, 96751, 96752, 96756, 96765, 96766, 96769, 96796
Maui County	4.5%	96708, 96713, 96728, 96729, 96732, 96733, 96748, 96753, 96757, 96761, 96763, 96767, 96768, 96770, 96779, 96784, 96788, 96790, 96793

These rates are applicable across all ZIP codes within the respective counties, meaning there is no variation in the sales tax rate within a county based on ZIP code. This consistency simplifies tax calculations and compliance for businesses operating in multiple locations within Hawaii.

Step 4: Registering for Sales Tax Permits (General Excise Tax) in Hawaii

Do You Need to Register for Sales Tax in Hawaii?

Yes, if you are conducting business in Hawaii, you must register for a General Excise Tax (GET) license. Hawaii does not have a traditional sales tax system; instead, businesses are required to collect and remit GET on their gross income from nearly all activities, including sales of goods and services. 

This applies whether you are a local business or an out-of-state seller with economic nexus in Hawaii (e.g., over $100,000 in sales or 200 or more transactions in the state).

How Much Does It Cost to Get a Hawaii Seller’s Permit?

Obtaining a GET license in Hawaii requires a one-time registration fee of $20. This fee covers the cost of registering your business with the Hawaii Department of Taxation and obtaining your Hawaii Tax Identification Number (Hawaii Tax ID), which serves as your seller’s permit.

How to Register for Sales Tax in Hawaii?

To register for a GET license in Hawaii, follow these steps:

1. Gather Required Information: Before starting the registration, make sure you have the necessary information on hand, including your employer identification number (EIN), business details, and ownership information.
2. Register Online: The quickest and most convenient way to register is through the Hawaii Tax Online portal. Simply create an account, complete the State of Hawaii Basic Business Application (Form BB-1), and pay the $20 fee.
3. Paper Application: Alternatively, you can download Form BB-1, complete it, and submit it by mail or in person at any Hawaii Department of Taxation district office. However, this method may take longer to process.
4. Receive Your Hawaii Tax ID: After submitting your application, you will receive your Hawaii Tax ID, typically within 3-5 business days if applied online, or 10-15 business days if applied by mail. This ID allows you to legally collect GET from customers and remit it to the state.

How to Get a Sales Tax ID in Hawaii?

As already explained, you can obtain a Sales Tax ID in Hawaii by registering for a General Excise Tax (GET) license through the Hawaii Tax Online portal. Once you complete the registration process and pay the required fee, your Hawaii Tax ID will be issued, enabling you to legally collect and remit GET on taxable transactions.

Does Hawaii Sales Tax Apply to Out-of-State Purchases?

Yes, Hawaii applies a Use Tax on out-of-state purchases when goods, services, or contracting are imported into Hawaii for use. The Use Tax is complementary to the GET and ensures that items purchased from sellers who are not subject to Hawaii’s GET are still taxed. 

The rate for the Use Tax is generally the same as the GET—4% statewide, with an additional 0.5% in certain counties. If you buy goods from out-of-state sellers who do not charge GET, you as the purchaser are responsible for reporting and paying the Use Tax directly to the Hawaii Department of Taxation​.

Section 5: Setting Up Your Online Store, Recordkeeping, and Calculating Hawaii General Excise Tax

How Do I Calculate Sales Tax in Hawaii?

Calculating sales tax in Hawaii is a bit different from other states. Here’s a basic overview of how you can calculate it:

1. Identify the Tax Rate: The base GET rate is 4% across the state. However, certain counties, like Honolulu, add a 0.5% surcharge, bringing the total to 4.5%.
2. Apply the GET to Gross Sales: Unlike traditional sales tax, GET is applied to the total gross income from sales. This includes not only the sales price of goods and services but also other income like shipping charges if included in the total sale.
3. Calculate the GET: Multiply the total gross income by the applicable GET rate. 

For example, if you made a sale in Honolulu County:

• Total Sale: $100
• GET Rate: 4.5%
• GET Amount: $100 x 4.5% = $4.50

4. Include GET in Pricing (Optional): Businesses in Hawaii often include the GET in their pricing to simplify billing, though it’s not required by law. If you do this, the GET is part of the total price shown to customers​.

eBay Sales Tax Hawaii Calculator

When selling on platforms like eBay, calculating Hawaii’s GET can be automated using eBay’s integrated tax tools. Here’s how it works:

1. Enable eBay’s Tax Collection: eBay automatically collects sales tax for orders shipped to states with marketplace facilitator laws, including Hawaii. The rate applied is based on the buyer’s shipping address and local tax rates.
2. eBay Tax Calculator: eBay’s tax calculator ensures the correct amount of GET is collected on each sale. Sellers don’t need to manually calculate the tax; it’s automatically applied based on Hawaii’s GET rate.
3. Reviewing and Reporting: Although eBay collects and remits the tax on your behalf, you should review your transactions to ensure everything aligns with your business records. Keeping accurate records will help you report your income correctly to the Hawaii Department of Taxation.

These tools simplify the process of collecting and remitting Hawaii’s GET, ensuring you stay compliant with state regulations while selling online​.

How to Calculate Sales Tax on a Car in Hawaii?

In Hawaii, calculating the sales tax on a car involves applying the General Excise Tax (GET) at a rate of 4% of the purchase price. However, if you’re purchasing the car in Honolulu County, the tax rate is higher due to an additional county surcharge, bringing the total to 4.5%. Here’s how you can calculate it:

1. Determine the Purchase Price: This is the total cost of the vehicle before any deductions like trade-ins or rebates.
2. Apply the GET Rate: Multiply the purchase price by the applicable tax rate. 

For instance, if you’re buying a car for $30,000 in Honolulu:

• Statewide GET Rate: $30,000 x 4% = $1,200
• Honolulu County Surcharge: $30,000 x 0.5% = $150
• Total Tax: $1,200 + $150 = $1,350

3. Add Additional Fees: Besides the sales tax, Hawaii also imposes vehicle registration and weight fees, which vary based on the vehicle’s weight and county​.

Reverse Sales Tax Calculator Hawaii

A reverse sales tax calculator is a tool that helps you determine the pre-tax price of a product when you only know the final price, including tax. This is particularly useful if you want to find out how much tax was included in a purchase price.

For example, if you know the gross price (after tax) of an item is $200, and the combined GET rate is 4.5%, the reverse sales tax calculator can help you determine the original pre-tax price. Here’s a simplified process:

1. Input the Gross Price: Enter the total price paid (e.g., $200).
2. Enter the Tax Rate: Input the combined tax rate (e.g., 4.5%).
3. Calculate: The calculator will subtract the tax portion from the gross price to show you the original price before tax was applied.

This calculation ensures that you understand the exact amount of tax paid on a transaction​.

Step 6: Charging & Collecting Hawaii Sales Tax 

What Does It Mean to Charge Sales Tax vs. Collect Sales Tax?

In Hawaii, the General Excise Tax (GET) operates differently from traditional sales tax. When you charge GET, you add the tax to the sale price of goods or services, either by including it in the price or itemizing it separately on the receipt. This is the most common method.

When you collect GET, you’re essentially acting as an intermediary between the state and your customers. You gather the tax from your customers at the point of sale and then remit it to the Hawaii Department of Taxation. This means you’re not absorbing the tax cost yourself.

It’s important to note that whether you charge or collect GET, you’re still responsible for paying the tax on your gross sales. GET is a tax on the business for the privilege of conducting business in Hawaii, regardless of how you handle the tax at the point of sale.

When to Charge Sales Tax in Hawaii?

You should charge GET on all taxable transactions in Hawaii. This includes the sale of tangible goods, most services, and other business activities. The GET rate generally applies to the gross income from these transactions. You need to charge GET if:

• Your business is physically present in Hawaii (physical nexus).
• You exceed the economic nexus threshold, which is $100,000 in gross sales or 200 or more transactions in Hawaii during the current or previous calendar year​.

How to Charge and Collect Sales Tax in Hawaii?

To properly charge and collect GET in Hawaii:

1. Determine the Applicable Rate: The standard GET rate is 4%, but it can be 4.5% in counties like Honolulu due to a local surcharge.
2. Include GET in Pricing: You have the option to include the GET in your prices or list it separately on receipts. If you choose to include it, clearly state that GET is included in the total price.
3. Collect GET from Customers: If you list GET separately, collect the appropriate amount from customers at the time of sale. Ensure that this amount reflects the correct rate based on the customer’s location.
4. Remit Collected GET: Regardless of how you handle GET on the customer-facing side, you must remit the collected tax to the Hawaii Department of Taxation. This can be done monthly, quarterly, or annually, depending on your filing frequency​.

Does Hawaii Collect Sales Tax on Out-of-State Sales?

Hawaii does not require businesses to collect the General Excise Tax (GET) on out-of-state sales, as the tax only applies to sales made within the state. If your business sells goods or services to customers outside of Hawaii, those transactions are generally not subject to Hawaii’s GET. 

However, if your business has a tax nexus in another state (e.g., through economic or physical presence), you may be required to collect sales tax in that state instead​.

Do Contractors Charge Sales Tax on Labor in Hawaii?

In Hawaii, contractors are subject to the General Excise Tax (GET) on their gross income, which includes labor charges. This means that contractors must charge GET on the labor portion of their services, just as they would on the materials used in a construction project. 

The applicable GET rate is generally 4%, but it may be higher if additional county surcharges apply. It’s important to note that contractors are required to pay GET on all revenue, regardless of whether they explicitly pass the tax on to their customers​.

Does Hawaii Charge Sales Tax on Shipping?

Yes, in Hawaii, shipping charges are generally subject to the General Excise Tax (GET) if they are included in the gross receipts of the sale. If you charge your customers for shipping as part of the sale, this amount is considered part of the total gross income and is therefore subject to GET. The tax applies whether the shipping charge is included in the price of the goods or listed separately on the invoice​.

Does Hawaii Charge Sales Tax on Services?

In Hawaii, most services are subject to the General Excise Tax (GET), which functions similarly to a sales tax. This includes a wide range of services, such as professional services (like legal and accounting), personal services (like haircuts and personal training), and even digital services (such as Software as a Service or SaaS). 

The standard GET rate for services is 4%, but in counties like Honolulu, an additional 0.5% surcharge may apply, bringing the total to 4.5%. It’s important to note that the GET applies to the gross income from these services, meaning the tax is calculated on the total amount charged to the customer​.

Does Hawaii Charge Sales Tax on Food?

Hawaii’s General Excise Tax (GET) does apply to food, making it different from many other states where grocery items are often exempt from sales tax. In Hawaii, both prepared food (such as restaurant meals) and grocery items purchased from stores are subject to GET. 

The tax rate for food is the same as for other goods and services: 4% statewide, with an additional 0.5% surcharge in certain counties like Honolulu. This means that whether you’re dining out or buying groceries, you will be paying the GET on those purchases​.

Do Photographers Charge Sales Tax in Hawaii?

Yes, photographers in Hawaii are required to charge the General Excise Tax (GET) on their services. This includes income from various photography-related activities such as portrait sessions, wedding photography, and the sale of prints or digital files. 

The standard GET rate of 4% applies, with a potential additional 0.5% surcharge in certain areas like Honolulu County. Photographers must apply this tax to the total amount charged for their services, including any session fees, editing charges, and the sale of final images​.

Does Amazon Charge Sales Tax in Hawaii?

Yes, Amazon charges the General Excise Tax (GET) on purchases made by customers in Hawaii. As a marketplace facilitator, Amazon is required to collect and remit GET on behalf of sellers when products are sold to customers in Hawaii. 

This includes both direct sales by Amazon and third-party sales facilitated through the Amazon platform. The GET rate is typically 4%, but in certain areas like Honolulu, the rate can be as high as 4.5% due to local surcharges​.

Does eBay Charge Sales Tax in Hawaii?

Similarly, eBay also collects the General Excise Tax (GET) on sales made to Hawaii residents. As of January 1, 2020, eBay, as a marketplace facilitator, is responsible for collecting and remitting GET on all eligible sales to Hawaii customers. 

This applies to both physical goods and certain services sold through the platform. The standard GET rate is 4%, with an additional 0.5% surcharge in some counties​.

Does Wayfair Charge Sales Tax in Hawaii?

Yes, Wayfair charges the General Excise Tax (GET) on purchases made by Hawaii residents. Following the South Dakota v. Wayfair decision, which allowed states to require out-of-state sellers to collect sales tax, Wayfair, as a large online retailer, collects GET on all sales shipped to Hawaii. 

The GET rate is 4% statewide, with an additional 0.5% surcharge in certain counties, such as Honolulu​.

Do You Charge Sales Tax on Rental Equipment in Hawaii?

In Hawaii, rental equipment is subject to the General Excise Tax (GET), which applies to the gross income generated from renting out the equipment. This includes all types of rental equipment, whether it’s construction tools, vehicles, or other tangible personal property. As a business renting out equipment, you are required to charge GET on the rental price. 

The standard GET rate is 4%, but in certain areas like Honolulu County, an additional 0.5% surcharge may apply, bringing the total to 4.5%. This tax is typically passed on to the customer, meaning you would collect it at the time of rental and then remit it to the Hawaii Department of Taxation​.

Can You Charge Sales Tax on Delivery in Hawaii?

Yes, in Hawaii, delivery charges are subject to the General Excise Tax (GET) if they are included in the sale of taxable goods or services. This means that if you charge a customer for delivery as part of a sale, that delivery charge is considered part of the gross income and is therefore subject to GET. 

The applicable tax rate is the same as for other taxable transactions: 4% statewide, with an additional 0.5% surcharge in certain counties like Honolulu. It’s important to include this tax when calculating the total amount due from the customer​.

Do You Charge Sales Tax to Nonprofits in Hawaii?

In Hawaii, nonprofit organizations are generally subject to the General Excise Tax (GET) on their income, including sales of goods or services. Nonprofits must collect and remit GET unless they qualify for an exemption. To be exempt from GET, a nonprofit must apply for and receive a GET exemption from the Hawaii Department of Taxation. 

Commonly, exemptions are granted for activities directly related to the nonprofit’s charitable, religious, or educational purposes. However, if the nonprofit engages in activities outside of its exempt purpose, such as selling goods or services that are not related to its mission, these transactions may be subject to GET. Therefore, unless the nonprofit has obtained a specific exemption, you should charge GET on sales to nonprofit organizations​.

Do Restaurants Charge Sales Tax in Hawaii?

Yes, restaurants in Hawaii are required to charge the General Excise Tax (GET) on the sale of food and beverages. The GET applies to all revenue generated by the restaurant, including dine-in, takeout, and delivery orders. 

The standard GET rate is 4%, but in certain counties like Honolulu, there is an additional 0.5% surcharge, bringing the total to 4.5%. This tax is usually passed on to the customer as part of the final bill. Restaurants must collect this tax at the time of the transaction and remit it to the Hawaii Department of Taxation​.

Section 7: Reporting, Paying, Filing & Remitting Sales Tax Returns in Hawaii

What is Sales Tax Reporting vs Payment vs Filing vs Remittance?

In Hawaii, the General Excise Tax (GET) system requires businesses to handle several key tasks related to tax obligations:

• Sales Tax Reporting: This refers to the process of documenting the amount of GET you’ve collected from customers. Reporting involves providing detailed information about your total sales, taxable sales, and any applicable exemptions on a periodic basis (monthly, quarterly, or annually).
• Sales Tax Payment: After reporting, you need to pay the amount of GET you owe. This is the actual transfer of funds to the Hawaii Department of Taxation. Payments are typically made when you file your GET return.
• Sales Tax Filing: Filing involves submitting your GET returns, which is where you officially report the sales and the amount of tax collected. In Hawaii, this is usually done via Form G-45 for periodic returns and Form G-49 for annual reconciliations.
• Sales Tax Remittance: This term is often used interchangeably with payment, but it specifically refers to the act of sending the collected tax to the state after you have filed your return. It ensures that the taxes collected from customers are properly delivered to the Hawaii Department of Taxation​.

Who Pays Sales Tax in Hawaii?

In Hawaii, the responsibility for paying the General Excise Tax (GET) lies with the business rather than the consumer. However, businesses typically pass this tax cost on to their customers as part of the total price of goods or services. 

Essentially, while the business is legally liable to pay GET, it is common practice to include this cost in the final sales price charged to the customer. This means that both local businesses and out-of-state businesses with a physical or economic nexus in Hawaii must collect and remit GET if they meet certain thresholds (e.g., over $100,000 in sales or 200 transactions in Hawaii).

When to Pay Sales Tax in Hawaii?

The frequency of GET payments in Hawaii depends on the total amount of tax your business owes:

• Monthly: If your annual GET liability is $4,000 or more, you are required to file and pay monthly. Payments are due on the 20th day of the month following the month in which the sales were made.
• Quarterly: Businesses with an estimated annual GET liability of at least $2,000 but less than $4,000 must file and pay quarterly.
• Semi-Annually: If your annual GET liability is less than $2,000, you are only required to file and pay semi-annually.

Returns and payments are due on the 20th day following the end of the reporting period. If the due date falls on a weekend or holiday, the deadline is extended to the next business day​.

Where Do You Pay Hawaii Sales Tax?

In Hawaii, businesses pay the General Excise Tax (GET) through the Hawaii Tax Online portal. This portal is the primary method for filing and paying all state taxes, including GET. It offers a secure and convenient way to manage your tax obligations, allowing you to make payments, file returns, and manage your tax accounts online. The portal is user-friendly and provides a comprehensive dashboard to help you track all your transactions and filing statuses.

How to Pay Sales Tax in Hawaii?

To pay your GET in Hawaii, you need to follow these steps:

1. Log in to Hawaii Tax Online: Access the Hawaii Tax Online portal and log in with your credentials. If you don’t have an account, you’ll need to create one during your initial registration for a GET license.
2. File Your Return: Once logged in, navigate to the “File Return” section on your dashboard. Choose the appropriate tax period and complete the required forms (typically Form G-45 for periodic returns and Form G-49 for the annual return). The system will guide you through entering your gross sales, exemptions, and taxable income.
3. Make a Payment: After filing your return, you can pay the tax due directly through the portal. You have the option to schedule payments and input your banking information for a direct debit from your account. Ensure that you complete this step by the due date to avoid late fees.
4. Keep Records: Once you’ve submitted your payment, save or print a copy of your return and payment confirmation for your records. This documentation is crucial for future reference and compliance checks.

How to Report Sales Tax in Hawaii?

Reporting sales tax in Hawaii is part of the filing process for the General Excise Tax (GET). Here’s how you do it:

1. Complete the Filing Form: The primary form used for reporting GET is Form G-45 (for periodic filings) or Form G-49 (for annual reconciliation). You will report your total gross income from all business activities, apply any exemptions, and calculate the amount of GET due.
2. Submit the Form Online: After completing the form, you submit it through the Hawaii Tax Online portal. The system will calculate the tax based on the information you provide and guide you through the submission process.
3. Review and Confirm: Before finalizing your submission, review the summary page to ensure all details are correct. After confirmation, your report will be filed, and you can proceed with payment.

How to File Sales and Use Tax in Hawaii?

In Hawaii, the General Excise Tax (GET) functions as the state’s version of a sales tax, applying to most business activities, including retail sales of goods and services. 

Use Tax, on the other hand, is imposed on goods imported into Hawaii for use, storage, or consumption when those goods were not subject to GET at the time of purchase. The Use Tax ensures that out-of-state purchases are taxed similarly to in-state purchases, maintaining fairness between local and external vendors.

As previously explained, you can file both GET and Use Tax through the Hawaii Tax Online portal, using the appropriate forms and following the filing deadlines.

What is the Deadline to Pay Sales Taxes in Hawaii?

The deadline to pay sales taxes in Hawaii, which are reported as part of the GET, depends on your filing frequency:

• Monthly Filers: The deadline is the 20th of the month following the month in which the sales were made.
• Quarterly Filers: For those filing quarterly, the deadlines are April 20, July 20, October 20, and January 20.
• Annual Filers: The annual filing deadline is January 20 of the following year.

These are the key “sales tax due dates” you must adhere to. Missing these deadlines can result in penalties, including a 5% late filing penalty per month, up to a maximum of 25%, and interest on the unpaid tax​.

Do Nonprofits Pay Sales Tax on Purchases in Hawaii?

Nonprofits in Hawaii are generally subject to the General Excise Tax (GET) on their purchases unless they qualify for a specific exemption. Nonprofits can apply for an exemption through the Hawaii Department of Taxation by proving that their purchases directly support their exempt purpose (e.g., charitable, religious, or educational activities). 

However, if the nonprofit engages in activities outside of its exempt purpose, such as commercial sales, those transactions may be subject to GET. Therefore, unless you have obtained a specific exemption for your nonprofit, you should expect to pay GET on purchases​.

Do Wholesalers Pay Sales Tax in Hawaii?

In Hawaii, wholesalers are subject to the General Excise Tax (GET) but at a reduced rate compared to retailers. The standard GET rate for retail sales is 4% (or 4.5% in certain counties), while the GET rate for wholesale transactions is only 0.5%. 

This lower rate applies when goods or services are sold for resale by another business rather than directly to the end consumer. For example, if you sell goods to a retailer who will then sell them to customers, you would be taxed at the 0.5% rate. However, to qualify for this rate, the wholesaler must obtain a resale certificate from the buyer to prove that the goods are indeed being purchased for resale​.

Do You Pay Sales Tax on a Leased Car in Hawaii?

Yes, when you lease a car in Hawaii, you are required to pay the General Excise Tax (GET) on the lease payments. The tax is calculated based on the total lease payments you make over the lease term, rather than the full purchase price of the vehicle. 

The standard GET rate applies, which is 4% statewide, with a possible 0.5% county surcharge in areas like Honolulu, making it 4.5%. This tax is generally included in your monthly lease payments, which means that each payment you make will include the tax portion​.

Do You Pay Sales Tax When You Buy a House in Hawaii?

In Hawaii, there is no sales tax on the purchase of real estate, including homes. However, other taxes and fees are involved in real estate transactions, such as the Conveyance Tax, which is based on the sale price of the property. 

Additionally, buyers should be aware of property taxes, which will be due annually based on the assessed value of the home. While the actual purchase does not incur a sales tax, these additional costs should be factored into the total expense of acquiring property in Hawaii​.

Section 8: Understanding Hawaii Sales Tax Holidays and Refunds

Does Hawaii Do Sales Tax Refunds? What is a Sales Tax Refund in Hawaii?

In Hawaii, the state operates under a General Excise Tax (GET) system rather than a traditional sales tax. Due to this structure, Hawaii does not typically offer sales tax refunds in the way other states might. The GET is levied on businesses rather than consumers, meaning the tax is applied to the gross income of businesses rather than directly on consumer purchases. 

Because of this setup, the concept of a “sales tax refund” for consumers is not commonly applicable in Hawaii. Refunds, when they occur, are generally related to overpayment or miscalculation of GET by businesses, rather than consumer refunds for overpaid sales tax​.

Does Hawaii Refund Sales Tax to Foreigners?

Hawaii does not refund the General Excise Tax (GET) to foreign visitors. Unlike some states and countries that offer tax refunds to tourists on purchases made within their borders, Hawaii’s tax system does not accommodate this. The GET is collected on all sales of goods and services within the state, and since it is a tax on the business, it is not eligible for refund to consumers, including foreign tourists​.

Is It Illegal Not to Refund Sales Tax in Hawaii?

In general, if a customer returns a product, the business should refund the sales tax (or GET in Hawaii’s case) along with the cost of the product. While Hawaii law does not specifically require businesses to refund the GET when an item is returned, failing to do so can be considered unfair practice and may lead to disputes or legal action. It is advisable for businesses to include the GET in any refunds provided to maintain good customer relations and comply with general consumer protection guidelines.

How to Claim Sales Tax Refund in Hawaii?

In Hawaii, claiming a sales tax refund is not a common process due to the nature of the state’s tax system, which revolves around the General Excise Tax (GET). The GET is levied on businesses rather than consumers, so traditional sales tax refunds for consumers don’t generally apply. 

However, businesses may be eligible for refunds or credits in certain situations, such as overpayments or exemptions that were not initially applied. To claim a refund, businesses typically need to amend their tax returns or file a specific refund request with the Hawaii Department of Taxation. It’s crucial to maintain thorough records and documentation to support any refund claims​.

Does Hawaii Give Sales Tax Holiday?

Hawaii does not have a sales tax holiday. Unlike some states that offer specific days or weekends where certain items are exempt from sales tax, Hawaii’s GET applies consistently throughout the year without any designated exemptions or holidays. 

A sales tax holiday generally refers to a temporary period when specific items, often school supplies or energy-efficient appliances, are exempt from sales tax to encourage consumer spending. Since Hawaii relies on GET, which is imposed on businesses rather than directly on consumers, the state has not adopted this type of tax holiday​.

Section 9: Understanding Sales Tax Audits and Penalties in Hawaii

What is the Penalty for Paying Sales Tax Late in Hawaii?

In Hawaii, if you pay your General Excise Tax (GET) late, you will incur penalties and interest. The standard late payment penalty is 5% per month, up to a maximum of 25% of the unpaid tax. 

In addition to this, interest on the unpaid amount accrues at a rate of 2/3 of 1% per month, or 8% annually. These penalties are designed to encourage timely payment and compliance with state tax laws.

Does Hawaii Do Sales Tax Audits?

Yes, Hawaii does conduct sales tax audits, particularly focusing on the GET. The Hawaii Department of Taxation regularly audits businesses to ensure compliance with tax laws. During an audit, the Department reviews your business records to verify that the correct amount of GET has been collected and remitted. 

The frequency and likelihood of an audit can depend on various factors, including the size of your business, the industry you’re in, and your filing history.

What Triggers a Sales Tax Audit in Hawaii?

Several factors can trigger a sales tax audit in Hawaii:

1. Inconsistencies in Reporting: Discrepancies between reported income and the actual income reflected in your records can raise red flags.
2. Large Changes in Taxable Sales: Significant variations in taxable sales from one period to another can prompt further investigation.
3. High-Volume Exempt Sales: If a large portion of your sales is exempt from GET, this may attract scrutiny to ensure that the exemptions are valid.
4. Random Selection: Sometimes, businesses are selected randomly for audits as part of routine compliance checks by the Hawaii Department of Taxation.

What is the Penalty for an Audit After the Due Date in Hawaii?

If you are audited in Hawaii and it’s determined that you owe additional taxes, penalties, and interest will be assessed if these amounts are not paid by the due date specified in the audit notice. 

The penalty for late payment is generally 5% per month on the unpaid tax, up to a maximum of 25%. Additionally, interest accrues at a rate of 2/3 of 1% per month (or 8% annually) on any unpaid taxes and penalties starting from the due date​.

What is Hawaii Sales Tax Penalty Waiver?

Hawaii offers a penalty waiver in certain circumstances where taxpayers can demonstrate reasonable cause for their failure to file or pay taxes on time. To request a waiver, you must submit a written explanation detailing the reasons for noncompliance and any supporting documentation. 

The Hawaii Department of Taxation reviews these requests on a case-by-case basis. Common reasons for granting a waiver include severe illness, natural disasters, or reliance on incorrect advice from a tax professional​.

If you believe you have a valid reason to request a waiver, it’s crucial to act promptly and provide thorough documentation to support your case.

Section 10: Hawaii Sales Tax Software – AtomicTax

To undersatnad and implement Hawaii’s General Excise Tax (GET) can be challenging, especially for businesses that operate across multiple channels or handle numerous transactions. This is where AtomicTax Ecommerce Sales Tax Software comes in—a powerful sales tax software designed to simplify tax compliance for ecommerce businesses.

AtomicTax seamlessly integrates with your existing systems, automating the calculation, collection, and remittance of GET. Whether you’re dealing with physical goods, services, or digital products, AtomicTax ensures that you apply the correct tax rates based on Hawaii’s unique tax structure. This means no more manual calculations, no more missed deadlines, and no more stress about audits.

Key Features & Benefits

• Automated Compliance: Automatically calculate and collect the correct GET rates for every transaction, ensuring compliance with Hawaii’s tax laws.
• Multi-Channel Integration: Whether you’re selling on Amazon, eBay, or your own ecommerce site, AtomicTax integrates smoothly, making it easier to manage taxes across platforms.
• Real-Time Updates: Stay up-to-date with the latest tax regulations in Hawaii, so you never have to worry about outdated rates or rules.
• Comprehensive Reporting: Generate detailed reports to simplify your filing process, giving you confidence when it’s time to submit your GET returns.

By choosing AtomicTax, you can focus on growing your business while leaving the complexities of Hawaii’s GET in capable hands.

Explore how AtomicTax can streamline your tax processes and keep your business compliant by visiting AtomicTax Sales Tax Software.

Conclusion

Remember, staying compliant with Hawaii’s unique tax regulations isn’t just about following the rules—it’s about securing the financial health of your business. By understanding when and how to apply the GET, and ensuring that you’re correctly filing and remitting these taxes, you set a solid foundation for your business’s long-term success.

Now that you have this comprehensive guide at your fingertips, it’s time to take action. Implement these practices in your daily operations to stay ahead of the curve. 

The effort you invest today in understanding and managing your tax responsibilities will pay off in the future, protecting your business from costly errors and helping you maintain a strong relationship with both customers and the state.