Bill > HB234

This bill modifies the Hawaii state income tax brackets and rates for two categories of taxpayers: those filing joint returns and surviving spouses, and unmarried individuals or married individuals filing separately. The bill creates new tax rate structures for taxable years beginning after December 31, 2025, with key changes including exempting taxpayers with lower incomes from higher tax rates. For joint filers and surviving spouses, individuals with taxable income of $200,000 or less will be exempt from the new higher tax rates, with new progressive tax rates applying to income over $200,000, ranging from 7.90% to 12.00%. Similarly, for unmarried or separately filing married individuals, those with taxable income of $100,000 or less will be exempt from the new higher rates, with new progressive rates from 7.90% to 12.00% applying to income over $100,000. The bill removes previously planned tax bracket changes for 2026 and 2028, instead implementing a new, simplified tax rate structure starting in 2025. These changes aim to adjust the state's income tax system, potentially providing tax relief for lower and middle-income taxpayers while introducing higher rates for higher-income earners.

Budget and Finance

https://www.capitol.hawaii.gov/session/measure_indiv.aspx?billtype=HB&billnumber=234&year=2026