Total state tax collections were up almost 5% in Fiscal Year 2019, which ended June 30.
That’s according to the Department of Taxation’s annual report, which was sent on Dec. 26 to Gov. David Ige and the state Legislature.
Tax collections for the fiscal year totaled $8.28 billion, a 4.8% increase over the $7.9 billion collected by the state in FY 2018.
“General excise tax … is Hawaii’s largest source of revenue, accounting for 43% of the state’s total tax collections,” wrote Rona M. Suzuki, the state’s director of taxation, in a cover letter to Ige. “Revenue from the GET rose to $3.54 billion in FY 2019 from $3.40 billion in FY 2018, an increase of 4.1%.”
Hawaii County received $10.2 million from its GET surcharge of 0.25%. That will increase, as the county surcharge was hiked to 0.5%, the maximum allowed under the law, effective Jan. 1 this year.
“Revenue from Hawaii’s individual income tax, Hawaii’s second largest tax, increased 17% to $2.57 billion in FY 2019 from $2.19 billion in 2018, accounting for 31% of the state’s total tax collections,” Suzuki wrote.
A reported 648,716 resident income tax returns were filed, with 499,287 of those, or 77%, filed electronically.
The state also reported $1.76 billion in “other” taxes collected, up from $1.69 billion the previous year.
That includes $600.3 million in transient accommodation taxes, which is also known as the hotel room tax; $206.3 million in fuel taxes; and $131.8 million in state motor vehicle weight taxes and registration fees, which are collected by the counties.
The counties’ share of the TAT totaled $103 million for the year. More than half, $340 million, went into the state general fund, with $79 million going to the tourism special fund, $57.4 million to the mass transit fund, and the remainder to other special funds.
Suzuki reported that in September 2019, the taxation department competed the fifth and final phase of work for its tax modernization project.
“We now have all our tax data in a single computer system and can focus on utilizing this system,” she wrote.
The distribution of tax revenues for the fiscal year include $7.14 billion, or 86.3%, in the state general fund, $649 million to “special funds,” $291 million to the counties from surcharges, and another $194 million transferred from the state to the counties.
The modernization program includes for the first time mandatory electronic filing of certain taxes.
Beginning in taxable periods starting September 2019, cigarette/tobacco, fuel, and liquor taxpayers were required to file electronically. Rental vehicle taxpayers were required to file electronically beginning October 2019.
Other changes in electronic filing requirements are set to start this year, according to the report.
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