Earlier this week, state legislators approved a measure that would take Transient Accommodations Tax (TAT) revenues away from Counties, but allow them to make up for lost funding with an additional tax surcharge of up to 3% to be added to the existing 10.25% rate charged by the state of Hawaii. Maui County Mayor Michael Victorino does not support the state’s decision, but he is considering the probable new revenue stream as a way to help mitigate some the financial impacts of tourism.
“I’d like to see 1% go toward the development of affordable and attainable workforce housing, 1% for emergency services including ocean, land and air rescues, and 1% to fund visitor education and cultural restoration throughout Maui County,” explained the mayor. “The loss of TAT funding is a blow, especially since the counties provide services for millions of visitors each year including police and fire protection, parks and road maintenance, and waste disposal. A new County tax surcharge can help to offset some of these costs. I look forward to working with the Maui County Council on this initiative.”
If enacted, the new 3% Maui County TAT tax surcharge would be levied on all stays at hotel rooms, licensed vacation rental units and other short-term accommodations. The mayor believes the surcharge will serve as an incentive for Maui County to crack down on the growing number of illegal vacation rentals that don’t pay TAT.