Land Use & Zoning
What is 'general excise tax' (GET) in Hawaii and how does it affect real estate transactions?
AA. A tax only on the purchase of vacant land; not applicable to improved properties
BB. Hawaii's GET is applied to real estate commission income earned by brokerages; agents and brokers must account for GET on their gross income at 4% (or 4.5% on Oahu with surcharge)✓ Correct
CC. A one-time tax on property purchase prices; replaces the federal capital gains tax
DD. Hawaii's GET is only collected on commercial real estate transactions
Explanation
Hawaii's General Excise Tax (GET) applies to virtually all business activity including real estate commissions and property management fees. Brokerages must pay GET (currently 4% statewide, 4.5% with Oahu county surcharge) on their gross commission income. Many brokerages pass through the GET to clients as an additional charge. Agents must understand GET for compliance and client disclosure.
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