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Hawaii Sales Tax/GET

Can someone please explain this to me? From what I read a business can determine whether this is passed on to you or not. Does that mean you will not see a separate charge on a bill for sales tax?

For instance, here in Michigan we have a 6% sales tax but there is an exemption for groceries. It's charged on clothing, restaurant food and generally anything rlseyou purchase

In Hawaii, the General Excise Tax (GET) is a tax on business gross income, rather than a traditional sales tax like in other states. This means that businesses are required to pay the GET on their sales, but they can choose whether to pass it on to customers or not.

Unlike traditional sales tax, which is usually shown separately on a bill (e.g., a percentage added to the price), GET is often included in the price of goods and services in Hawaii. This means you may not always see a separate line item for tax, but the price you pay includes the tax. Some businesses may explicitly mention the GET charge on the bill, while others may roll it into the final price.

For example, in Michigan, you are accustomed to seeing a 6% sales tax charged on most goods and services (except groceries). In Hawaii, the GET works a bit differently. Here’s a breakdown:

  • The GET rate varies depending on the type of business, ranging from 0.15% to 4.5%. The most common rate is 4.5% for retail and service businesses.
  • Many businesses do pass the GET on to customers, but it's usually included in the price, not listed separately.
  • Businesses may also apply the GET to items that are exempt from sales tax in other states, like certain food items, which may not be the case in Michigan.

Therefore, if you're shopping or dining in Hawaii, you may not see a distinct "sales tax" line item as you would in Michigan. Instead, the price you pay likely includes the GET, but it could be embedded in the overall price, or it may be noted on the receipt as part of the business's cost structure.

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