Standard rate
The standard rate in Hawaii for sales tax for 2024 is 4-4.5%.
Reduced rate
There is a reduced rate of 0.5% for wholesaling goods, manufacturing, producing, providing wholesale services, and business activities of disabled people.
Sales of tax-free products and services
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Who must register sales tax in Hawaii
A person is engaging in business in the State, regardless of whether the person is physically present in the State if, in the current or preceding calendar year, the person has a gross income of $100,000 or more from the sale of tangible personal property delivered in the State, services used or consumed in the State, or intangible property used in the State; or the person has entered into 200 or more separate transactions. If you do not meet any of the criteria that create nexus in Hawaii (physical, economic, or otherwise), you won’t need to register for a sales tax license in this state.
Threshold
If you are a retailer with a physical presence in Hawaii or you are a remote seller who has crossed the economic nexus threshold for Hawaii ($100,000/year in gross revenue, or more than 200 separate sales transactions in Hawaii in the previous or current calendar year), then you will need to register for a Hawaii sales tax license.
Marketplace thresholds by state
The special rules are applicable to the SAAS business.
Software as Service Tax Thresholds by state.
Online Marketplaces
All businesses that sell taxable tangible personal property in Hawaii are required to register with the state and collect and transfer sales tax. Providers of many services required to complete the sale of taxable tangible personal property must also register and collect.
If all of your sales in Hawaii are through a marketplace reseller platform, you will need to register for paying sales tax if you meet the $100,000 or 200 transactions threshold for remote sellers.
Sales tax payment and filing date
Based on your tax liability, determine your filing frequency – either monthly, quarterly or Annual:
- Annual – $0 to $2,000;
- Quarterly – $2,000 to $4,000;
- Monthly – $4,000 and up.
Sales tax returns are always due on the 20th day of the month following the broadcasting period. If the filing due date falls on a weekend or holiday, sales tax is due the next day.
Penalty and interest
- Taxpayers who file their tax return late will be subject to a late-filing penalty of 5% per month, or part of a month, on the unpaid tax up to a maximum of 25%.
- Interest is calculated at 2/3 of 1% per month or part of a month, on unpaid taxes and penalties beginning with the first calendar day after the date prescribed for payment, whether or not the first calendar day falls on a weekend or legal holiday.
Exemption
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Hawaii Sales Tax Holiday
Hawaii currently does not have any sales tax holidays.
Hawaii Sales Tax Nexus:
- Physical Nexus: Physical Nexus in Hawaii is established when a business has a physical presence, such as an office, warehouse, store, or employees in the state. Businesses with physical presence must register with the Hawaii Department of Taxation and comply with state tax requirements.
- Economic Nexus: Hawaii’s economic Nexus threshold is $100,000 in sales or 200 transactions in the current or preceding calendar year. Remote sellers exceeding these thresholds must collect and remit Hawaii General Excise Tax (GET).