How Hawaiʻi could prepare for financial impacts of second Trump term

Working families in Hawaiʻi could end up paying more in taxes if President-elect Donald Trump implements some of his proposed policies, but analysts say there’s a way the state can help.

Some of the policies Trump floated before taking office for his second term include imposing heavy tariffs on imported goods from other countries, reducing corporate tax rates and repealing President Joe Biden’s tax credits on renewable energy.

They would outweigh some tax-saving policies he’s floated, such as exempting taxes on overtime pay, tips and Social Security benefits and extending some tax provisions he implemented in 2017.

An analysis by the nonprofit Institute on Taxation and Economic Policy shows that Trump’s tax proposals could lead to significant tax breaks for the richest 5 percent of Americans in 2026—but a tax hike of up to about $1,800 for the bottom 95 percent of earners.

Trump is also interested in reducing federal funding, which could mean less support for low-income food and health care programs.

Hawaiʻi Appleseed senior policy analyst Devin Thomas recently published a post on the potential impacts of Trump’s second term on local families.

There are some ways the state can prepare, such as by supporting low-income programs, and increasing taxes that would have a greater impact on the wealthy — including nonresidents who invest in Hawaiʻi homes.