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Bill Summary · SB 875

Legislative bill overview

SB 875 proposes to reduce Hawaii's general excise tax (GET), a broad-based sales tax that applies to most goods and services in the state. The bill was introduced in January 2025 and has been referred to committee but has not yet advanced to a floor vote, having been carried over to the 2026 legislative session.

Why is this important

Hawaii's GET is one of the highest general excise taxes in the nation at 4.5%, with additional county surcharges bringing effective rates to 4.5-4.712%. Any reduction would affect consumer prices, business compliance costs, and state revenue—potentially impacting $2+ billion in annual general fund revenue. The outcome would reshape Hawaii's tax competitiveness and state funding capacity for public services.

Potential points of contention

  • Revenue impact: Tax cuts reduce state funding for education, healthcare, and infrastructure unless offset by spending cuts or other revenue sources
  • Regressive burden: GET disproportionately affects lower-income residents who spend more of their income on taxable goods and services
  • Implementation details: The bill's specific reduction amount, effective date, and any exemptions are not detailed in available information, making full fiscal analysis impossible

Compiled from official sources — confirm details with the bill’s official record.

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