Passage of Bill Will Lead to Hawaii’s First State EITC

On May 2nd, the Senate and House voted to pass HB 209, putting us just one step away from a Working Family Credit in Hawaii, and greater tax fairness for low-income residents. House Speaker Scott Saiki has labeled the passage of the state Earned Income Tax Credit (EITC) as the “most consequential work in the last few years to reduce poverty and Hawaiʻi’s high cost of living.”
 
Hawai’i Appleseed led the effort to get the EITC (or “Working Family Credit”) passed by the legislature earlier this month. The credit will generate an estimated $12.7 million in tax relief for low-income working families in its first year, and over $27 million by its fifth year. A significant portion of the 104,000 households and 128,000 children in Hawai’i who receive the federal EITC will benefit from the new credit.
 
Additionally, HB 209 will make permanent the low-income Food/Excise Tax Credit intended to offset a portion of the state’s regressive General Excise Tax. The total package means more than $136 million in tax relief for low-income households over five years—putting significant dollars back into the pockets of the people who need them most to make ends meet.
 
Find out more about our work to change Hawaiʻi’s tax system at www.hitaxfairness.org or by reading our recent report, “Struggling to Make Ends Meet: The Need for a Working Family Credit.”