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Why incorporate in Hawaii?

Business Information & Rankings

  • Hawaii ranked as the Most Expensive State to Do Business (Cost-of-Doing Business Index, Milken Institute, 2005)
  • Hawaii ranked 50th on Climate for Small Business and Entrepreneurs (Small Business Survival Index, 2004)
  • Hawaii ranked last on the State Business Tax Climate Index (The Tax Foundation, 2004)
  • A poll of 458 Chief Executives ranked Hawaii as the 5th -least-attractive state for business.

Note: It is expensive to live and do business in Hawaii. A limit on the amount of developable land available and Hawaii?s distance from the Mainland translates to higher costs associated with having to import most items. Because of these reasons, Hawaii does not rank well on most business indexes.

Cost of Living Index

For Honolulu, HI (2005):Index Score
Misc. Goods & Services:124.1

Crime Rate

Hawaii has the 46th lowest crime ranking in the U.S. (U.S. Dept. of Justice, FBI, Uniform Crime Reports, 2004)

Fees & Taxes

Business Inventory Tax
Business inventory is exempt.

Corporate Income Tax

First$25.0004.4 %
Next$75.0005.4 %
Over$100.0006.4 %

Qualified taxpayers with Hawaii sales of $100,000 or less may pay an alternative tax of 0.5% of Hawaii gross annual sales.

Personal Income Tax
Hawaii’s personal income tax system consists of nine brackets with a top rate of 8.25% starting at an income level of $40,000. This top rate ranks the state 5th highest among states levying personal income taxes.

Personal Property Tax
Exempt. Intangible personal property is exempt from taxation. Personal property such as cars or boats are not subject to property tax.

Real property, land and improvements are taxed with assessments at 100% “fair market value.” Tax rates are per $1,000 net assessed value.

State Sales and Use Tax
Base Rate: 4%
Machinery Rate: 0.5%

Unemployment Insurance
Hawaii’s new employers’ rate is 2.4% for 3 years.