Hawaii’s annual tax bill, which is the biggest in the nation, is set to top $100 billion for the first time.
The tax, which kicks in April 1, is expected to raise $10 billion over the next decade, according to a report released Thursday by the Hawaii Economic Development Authority.
The $1.3 billion tax is projected to be the biggest ever in Hawaii, according a recent study by the University of Hawaii at Manoa.
The report said the tax could increase the state economy by about $1 billion annually.
The levy is also projected to generate a revenue stream that could be used to expand local and state programs.
The Hawaii Tourism Association is optimistic that the tax will raise more than $2 billion for Hawaii’s tourism economy.
“The tax will help keep our state competitive, help our local economies grow, and provide an incentive for employers and businesses to invest in the tourism industry,” Hawaii Tourism Director Mike O’Connell said.
The $100 million figure, which does not include property taxes, is not expected to change much.
Hawaii’s state revenue is expected grow by about 2.5 percent a year, or about $6 billion, according the study.
However, the tax does have some downside risks.
The revenue will not be able to keep up with the cost of building the new airport and building new roads, and it will not generate enough tax revenue to pay for infrastructure projects, O’Connor said.
The study also found that Hawaii will not get any additional revenue from the new tax, but will lose $3.6 billion from an increase in property taxes in 2018.
Hawaii has a population of about 1.5 million and is located in the West Coast of the United States.
The Hawaii Economic Growth Authority expects the new property tax will generate about $7 billion in tax revenue for the State.
The new tax will be collected by the state through a two-tiered system, with the first tier of property taxes going to the Hawaii Tourism Authority, and the second tier going to hotels, motels, restaurants and other businesses that use public transportation.
The authority collects the second-tier property tax from the hotels, restaurants, motel, and other business that pay the state sales tax, according O’Connell.
The increase in taxes will not impact residents of Hawaii, which has about 10 million residents.