Bill > SB1214

This bill establishes a new tax surcharge and fund targeting residential properties in Hawaii that remain vacant for more than 180 days per year. The legislation creates a Vacant Homes Special Fund administered by the Hawaii Housing Finance and Development Corporation, which will collect revenues from a new surcharge designed to incentivize property owners to either occupy their properties or make them available for long-term rental. The surcharge will be 4% of both the average annual rental value and the estimated general excise tax that would have been collected if the property were occupied. Property owners must obtain a general excise tax license and file an annual return reporting their property's vacancy status. The bill provides several exemptions for vacancy, including properties undergoing renovation, properties owned by military personnel, and properties vacant due to owner hospitalization or legal requirements. Counties are required to disclose to the Department of Taxation a list of properties classified as not owner-occupied, and the Department of Business, Economic Development, and Tourism will calculate average annual rental values. The revenues collected will be used to fund rental assistance programs similar to federal Section 8 housing assistance, with the goal of addressing housing availability and supporting local economic activity. The bill is set to take effect on January 1, 2026.

Housing and Urban Affairs

https://www.capitol.hawaii.gov/session/measure_indiv.aspx?billtype=SB&billnumber=1214&year=2026