New Hotel Tax in Honolulu: What You Need to Know
Honolulu is implementing a new hotel tax that introduces an additional 3% surcharge to all hotel and short-term accommodation stays, including Airbnb rentals. This measure mirrors similar taxes already established in Kaua’i, Maui, and Hawai’i.
Details of the New Tax
The additional 3% tax will be collected from guests occupying hotels and short-term rentals in O’ahu, as reported by the Associated Press. This change follows a bill passed in July that reduces funding for the Hawaii Tourism Authority and alters the way tax revenue is collected across various counties.
Revenue Allocation and Local Impact
Previously, Hawaii’s state collected a 10% hotel tax and allocated funds to each county based on population size. The recent changes mean counties will now receive funding based on tourist numbers per capita. Moreover, the revenue from the new 3% tax will be directed towards enhancing local services and infrastructure for residents and tourists alike.
As reported by the Honolulu Star-Advertiser, a third of the tax revenue will focus on developing Honolulu’s rail service, with an additional 8% earmarked for a special fund dedicated to natural resources impacted by tourism, such as maintaining national parks and beaches. The remainder will contribute to the county’s general fund.
Actions Following the Tax Implementation
Honolulu’s mayor, Rick Blangiardi, endorsed the new tax bill on a recent Tuesday, setting the implementation date for January 1, 2022.
In recent months, Kaua’i, Hawai’i, and Maui counties have also initiated similar hotel taxes, especially as Hawaii faced a substantial rise in tourist numbers following the relaxation of travel restrictions. This surge, in conjunction with limited resources from the pandemic, created challenges such as increased traffic congestion and waste management issues on local beaches.
