Minimum Sales Rate Tax for 2024
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| 0.00% | Column content | Column content | Column content | Column content | |
| 0.50% | Column content | Column content | Column content | Column content | |
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| Minimum combined sales tax rate value | 4.5% | Column content | Column content | Column content | Column content |
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| Economic sales nexus threshold | $100,000 | Column content | Column content | Column content | Column content |
| Transactions threshold | 200 | Column content | Column content | Column content | Column content |
| Sales tax return filing due date | 20th day of the month following the close of the tax period. | Column content | Column content | Column content | Column content |
The base state sales tax rate in Hawaii is 4%, but since the city-specific tax rate is 0% and the Honolulu County tax rate is 0.5%, the minimum sales tax rate for Hilo is 4.5%.
How to calculate your sales tax rate
Use our online sales tax calculator to determine the combined state and local sales tax rate for each location where you have a physical or economic nexus. Just enter your state and ZIP code to get your sales tax rate.
Looking for help calculating your sales tax? Contact us today to book a free consultation!
What is nexus?
In Hilo, businesses must understand “nexus” to determine their tax obligations. Nexus refers to the connection that requires a business to collect sales tax in a state. This concept became even more important after the U.S. Supreme Court’s decision in South Dakota v. Wayfair, Inc., which allowed states to require sales tax collection based on economic activity rather than just a physical presence.
Specific sales tax rules for Hilo
In Hawaii, the General Excise Tax (GET) stands in for what most states call sales tax, but it works differently. Rather than taxing just the consumer, Hawaii imposes the GET on businesses for the right to operate in the state. Businesses often pass this cost on to customers. The GET covers almost all transactions, including services, with a base rate of about 4%, though it varies slightly by county. The catch? It’s applied at multiple stages in the business process, so the tax can quickly stack up.
In addition to the standard rate, there are lower rates for specific activities: 0.15% for insurance commissions, and 0.5% for wholesaling, manufacturing, producing, wholesale services, and the use tax on imports intended for resale.
Services
Mostly taxable.
Goods
You must charge sales tax on most physical items, including appliances, vehicles, furniture, sports equipment, and electronics.
Clothing
Taxable.
Electronics
Taxable.
SaaS
Taxable.
Digital Products
Taxable.
Software
Both off-the-shelf and custom software are taxable.
Freight/Shipping
Shipping fees are usually not taxed unless included in the sales price.
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