Q: How do I get a Hawaii General Excise Tax License for my business? Is that something you all can do?
Thank you to Bill Dasher of North Light Media for this great question! While most states have a sales and use tax license that business are required to obtain, Hawaii has a General Excise Tax License (GET). Obtaining a Hawaii GET License is a requirement to be able to do business in Hawaii. Luckily it is a pretty straightforward process. We’ll show you how to do get a GET for your Hawaii business.
What is a Hawaii GET License?
Instead of a sales tax, Hawaii has a tax called the General Excise Tax. The GET is a basically a fee levied on businesses for the privilege of doing business in Hawaii. The GET is a tax imposed on the gross income received by any person or business that is engaging in business activity in Hawaii. Gross income is the total of all the business income before deductions for business expenses. The GET rate is 4% on most products and services, though there are some exceptions such as a 0.5% tax rate for business involved in wholesaling and manufacturing. Some of the activities subject to Hawaii’s GET include farming, ranching, retail services, construction contracting, renting of personal or real property, tourism, hotels, and business interest income.
What is the difference between sales tax and a general excise tax?
There are two main differences. First, the GET is a tax on businesses for the privilege of doing business in Hawaii. A sales tax is a tax on the customer that is collected by the business. More importantly, the GET is a tax on income from most business activities. Sales taxes are taxes on the sale of tangible goods (physical objects like books, clothing, cooking utensils) or services. However, most businesses will pass along the GET to the consumer.
Check out our page on Hawaii LLC Taxes to learn more about other taxes you may need to pay while doing business in Hawaii.
How do I obtain a GET for my business?
Your GET license is obtained through Hawaii’s Department of Taxation as a part of applying for a Hawaii Tax ID Number. The General Excise Tax License can be obtained by registering online through Hawaii’s Business Express website, or through the Department of Commerce and Consumer Affairs. You can download Form BB-1 and submit it by mail or in person. In person filings will receive their Hawaii Tax ID number immediately. There is a one time filing fee of $20 for the GET license.
Mail and in person filings:
Department of Taxation
P.O. Box 1425
Honolulu, HI 96806-1425
How long will the licensing process take?
Online filings will take up to five business days to process. Mailed filings can take as long as two weeks. In person filings are processed while you wait.
Is a GET license the same as a business license?
No. A GET license simply gives your business the privilege of doing business in Hawaii. You’ll most likely need some other types of business licensing depending on what kind of business you are engaged in. For example, if you’re in the restaurant business, you’ll need to obtain all sorts of food safety licenses as well as occupancy permits from the state. You can find a list a state-level license- and permit-issuing agencies through Hawaii’s Department of Commerce & Consumer Affair’s Business Action Center.