Hawaii's Income Tax on the Working Poor: A Post-Session Update

Publication Date: July 2007

Publisher: Center on Budget and Policy Priorities (Washington, D.C.)

Author(s): Jason Levitis

Research Area:

Keywords: Income diversity; Tax code; Economic inequality; Economic projections

Type: Report

Coverage: Hawaii

Abstract:

On June 26, Hawaii Governor Linda Lingle signed SB 1882, which expands Hawaii's refundable low-income tax credit. The bill's passage follows a long debate about how best to cut taxes on Hawaii’s low-income working families, who face higher income taxes than such families in almost any other state. SB 1882 provides important help for low-income working families with children. But even with tax cuts enacted in 2006, SB 1882 is not sufficient to eliminate income taxes on working poor families. Despite the improvements SB 1882 provides, Hawaii will continue to levy high taxes on poor families — higher than almost every other state.