House Passes Bills to Increase Big Island Share of TAT Revenues

The Hawai‘i House Finance Committee passed Senate Bill 648 SD1 HD1 on Thursday, March 15, 2018, which will increase the amount of the Transient Accommodations Tax (TAT) revenues for the Neighbor Islands.

The amended bill provides an additional $36 million to support projects essential for Neighbor Island residents including:

• Increasing Hawai‘i Island’s TAT revenues from $19,158,000 to $31,248,000
• Increasing Kaua‘i’s TAT revenues from $14,935,000 to $24,360,000
• Increasing Maui’s TAT revenues from $23,484,000 to $38,304,000

The TAT amount for the City & County of Honolulu is unchanged for a total of $45.4 million per year.

The TAT is paid by hotel guests to the state and allocated to several groups, including the counties, to pay for visitor released expenses.

During the 2017 Special Legislative Session, lawmakers voted to raise the TAT by 1% to immediately address the shortfall of Oʻahu’s rail project. At that time, House leaders discussed the possibility of revisiting proposals to increase TAT revenues for the Neighbor Islands.

House Speaker Scott K. Saiki credited Neighbor Island Representatives with working to find ways to provide more funding for the Neighbor Islands. Saiki said this bill is a product of their discussions.

“During the special session last summer, our Neighbor Island Representatives were concerned about the need to increase the counties’ share of the TAT,” said Saiki (McCully, Kāheka, Kakaʻako, Downtown). “This proposal will provide much needed financial support for the Neighbor Islands.”