In Hawaii, can a renter charge sales tax?

Question

This is for an apartment rental.

Answer 1

HI does NOT have a sales tax. They have a General Excise Tax, also known as a Gross Receipts Tax. It's a tax levied on ALL business transactions regardless of the characterization of the transaction. It is levied on landlords for all rental income received (along with virtually all commercial transactions) before any deductions for expenses, etc.

Business, including landlords, are allowed to separately state the tax amount for their customers' benefit but are not required to do so. Your landlord is simply showing you what the General Excise Tax is for the rents you are paying, he is NOT charging "sales tax" on your rent.

(BTW, the "renter" is the person living in the apartment. The person you pay the rent to is called a "landlord." Thererfore a "renter" would never "charge" the GET, but a landlord certainly would have to pay it.)

Answer 2

hey i also live in hawaii. I have never heard of a renter charging sales tax... I don't believe sales tax applies to rent, but they might be passing some other tax on to you. Are you sure they mean sales tax?

Answer 3

I never heard of anyone charging sales tax. Tell the landlord if they want to pocket some extra money, just raise the rent.. otherwise they may wind up in jail on tax fraud.

Chances are if no one else charges tax it is illegal... If it were legal, everyone would HAVE to do it....

Answer 4

Different states have different rules on what is taxable. The state department of revenue or taxation lists these things and the applicable tax rates on their websites. I have never heard of sales tax on rent, but HI could be different...much different real estate issues...