Despite lawmakers touting affordability as a top priority, Hawaii policymakers are once again advancing proposals that would increase the tax burden on residents in 2026 and beyond.
Just two years after passing historic income tax relief, state leaders are now considering pausing those cuts and layering on new taxes and fees — moves that would make life even more expensive for families already struggling to get by.
Hawaii continues to face a serious affordability crisis. For years, residents have been voting with their feet, leaving the islands for states like Washington, Nevada, Texas and Florida where taxes are lower and economic opportunity is greater. Imposing new taxes only accelerates that trend, undermining long-term economic stability.
As residents leave, the consequences compound. Fewer workers are available to staff private businesses, schools, hospitals, and government agencies.
Calls for higher taxes also ignore the state’s overall fiscal position. Hawaii continues to maintain substantial reserves, and lawmakers have options to address budget challenges without reaching deeper into taxpayers’ pockets.
Rather than undoing tax relief or creating new revenue streams, policymakers should first examine spending growth, program effectiveness, and long-term structural reforms.
Now is not the time to raise taxes or introduce new fees under the guise of short-term fixes. Proposals such as increasing capital gains tax rates, creating a “wealth asset” tax or expanding the GET surcharge ultimately worsen Hawaii’s cost-of-living crisis.
Hawaii’s residents and businesses need certainty, stability, and relief — not shifting tax policy and higher financial burdens.
Lawmakers should honor the tax reforms already passed and focus on policies that make Hawaii more affordable to live, work and invest in, rather than pushing even more people to leave.
