State Sales Tax Nexus and General Overview

Need to Understand a State's Sales Tax Situation? Here it is...

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Hawaii (HI)

HI Sales Tax - Name of Tax and General Application:

Hawaii imposes a tax on sales of goods and services in the state. This is called an "excise tax" or "sales tax". There is also an excise tax on the importation of tangible personal property by a taxpayer for use in Hawaii. This is known as a "use tax" and only applies where sales tax has not already been paid.

HI Nexus - General Requirements:

The word "nexus" means a link or connection. If you are determined to have nexus to a U.S. state then you are subject to that state's sales and use tax rules and must collect and remit sales tax to the state. This is known as a "filing obligation."

Each state has a different definition of nexus. However, if the answer to any of the following questions is yes, it is likely that a company has nexus as legally defined in most U.S. States.

Does the company own property in the state? Does the company have employees living in the state? Does the company regularly send employees in the state to perform services? Does the company have an agent acting on behalf of the company in the state?

Hawaii requires persons "doing business" in the state to collect and pay excise and use tax. Doing business in Hawaii entails all activities with the object of gain or economic benefit, not including casual sales.

HI Local Tax - Do Localities Impose Tax?

Yes, Hawaii imposes local sales tax.

HI Resale Certificate Renewal Agreements:

A seller can hold a resale certificate for a purchaser of tangible personal property. This certificate states that the sale is at wholesale.

HI Resale Certificate Renewal Periods

The certificate is valid until revoked by written notice or it is specified in writing that it doesn't apply to certain orders.

HI Statute of Limitations

Later of three years from the date the return was due or from the date the return was filed.