Hawaii Sales Tax Calculator

Hawaii has a general excise tax, not a sales tax

Hawaii has no sales tax in the usual sense. Instead it has a general excise tax (GET), which the Department of Taxation applies to the gross income of almost every business activity in the state. The retail rate is 4.00%. Every county now adds a 0.5% surcharge, bringing the combined rate to 4.50% in all four counties.

The legal difference matters: the GET is a tax on the business, not on the customer. A business can choose to show it on the receipt, but it is not required to. If a business does not pass it on visibly, it pays the GET out of its own revenue and builds it into its prices.

County surcharges by county

The surcharge applies only to activities taxed at the 4% rate, not to wholesaling, manufacturing or producing (0.5%) or insurance commissions (0.15%).

Why your Hawaii receipt shows 4.712%, not 4.5%

Because the GET is charged on a business's total gross income, and any tax the business passes on counts as part of that income, a business that wants to recover its full tax has to charge slightly more than 4.50%. The state sets the maximum pass-on rate, including the county surcharge, at 4.712%. That figure is simply 4.50% ÷ (1 − 4.50%) = 4.712%.

Worked example: on a $100.00 sale, a Honolulu shop that passes on the maximum charges $4.71, for a total of $104.71. The shop's gross income is then $104.71, and 4.50% of that is $4.71, exactly the amount it collected. Consumer protection rules prohibit charging more than the actual GET due.

Groceries, medicine and services are generally taxed

Hawaii's GET covers far more than a typical state sales tax. Groceries are not exempt, except food bought with SNAP benefits or WIC vouchers. Services, from haircuts to legal advice, are generally taxable too, as is rent. This broad base is why the GET raises a lot of revenue despite its low headline rate.

Prescription drugs and prosthetic devices are exempt when sold to an individual by a hospital, clinic, health care facility, pharmacy or licensed practitioner.

Use tax on goods brought into Hawaii

Hawaii charges a use tax on property, services, contracting and intangibles imported for use in Hawaii from an unlicensed out-of-state seller that does not pay the GET. It is charged at the same rates as the GET, to remove the price advantage such sellers would otherwise have over local businesses: 0.5% on goods imported for resale, and the retail rate on goods for your own use. No use tax is due if GET was already imposed on the purchase.

Use tax is based on the "landed value", meaning the purchase price plus shipping and handling, insurance and customs duty, but not sales tax paid to another state. For example, a $900.00 item with $100.00 of freight has a landed value of $1,000.00, and use tax at 4.50% would be $45.00.

Most major online retailers now collect Hawaii tax at checkout, so use tax mainly affects purchases from small mainland sellers and goods shipped in by freight.

How to reverse a Hawaii receipt

If the receipt shows the maximum 4.712% pass-on, divide the total by 1.04712 to get the price. For a $52.36 total, that gives $50.00. If the business priced items with the tax already included, there is no separate tax line, and the GET is part of the shelf price.

GET vs a typical sales tax

Because each stage in the supply chain pays GET, the tax can pyramid. A manufacturer pays 0.5%, a wholesaler pays 0.5%, and the retailer pays the full retail rate on its final sale. Each layer can be built into the next price, so the true tax content of a product is a little higher than the rate on the receipt.

Hawaii compared with West Coast states

Hawaii's 4.50% combined rate looks low next to California's 9.03% and Washington's 9.57% averages, but the comparison flatters Hawaii. Its tax applies to groceries, most services and rent, which many states exempt.

Worked example: a service bill in Hawaii

Because the GET applies to services, a plumber's $200.00 labour charge is taxable. If the plumber passes on the maximum rate, the bill shows $9.42 of GET, for a total of $209.42. If the plumber quotes a flat price including tax, there is no separate line, but the plumber still owes 4.50% of its gross income to the state.