Bill > SB1260

This bill establishes an agroecological and climate-smart farming practices tax credit for farmers in Hawaii, which will provide financial incentives for sustainable agricultural practices starting in the 2026 tax year. The tax credit will allow qualified farmers to deduct a percentage of their qualified expenses related to sustainable farming practices from their income tax liability, with a maximum credit of $25,000 per taxable year and a total statewide cap of $1,000,000 annually. Qualified expenses include costs associated with implementing practices that promote soil health, fertility management, pest control, crop diversity, and conservation of native and Polynesian-introduced plants, such as traditional Native Hawaiian agricultural systems like lo'i kalo (wetland taro cultivation) and agroforestry. Farmers must submit a certified statement to the Board of Agriculture by March 31st detailing their qualified expenses, and if the tax credit exceeds their tax liability, they can carry forward the excess credit for up to five consecutive years. The Department of Taxation will develop the necessary forms and rules to administer the credit, and the Board of Agriculture will establish standards for certifying qualified expenses and eligible farming practices.

Agriculture and Natural Resources, Budget and Finance

https://www.capitol.hawaii.gov/session/measure_indiv.aspx?billtype=SB&billnumber=1260&year=2026