Bill > SB704

This bill permanently increases the state earned income tax credit (EITC) from 40% to 50% of the federal EITC for qualifying individual taxpayers. The EITC is a refundable tax credit designed to provide financial support to low to moderate-income working individuals and families by reducing their tax burden and potentially providing a refund. The change will apply to taxable years beginning after December 31, 2024, meaning taxpayers will first be able to claim the increased credit when filing taxes for the 2025 tax year. The bill also modifies a previous legislative act (Act 163 from 2023) to ensure that the increased EITC percentage is permanently implemented, removing a previous provision that would have reverted the credit back to its earlier percentage. By increasing the state EITC to 50% of the federal credit, the bill aims to provide additional financial support to working families in Hawaii, potentially helping to reduce economic hardship and incentivize workforce participation.

Budget and Finance

https://www.capitol.hawaii.gov/session/measure_indiv.aspx?billtype=SB&billnumber=704&year=2026