Senate Judiciary Committee passes wealth asset tax bill for assets above $20M

The Hawaiʻi State Senate Committee on Judiciary passed Senate Bill 313 in a hearing Thursday morning, which would implement a wealth asset tax for assets valued over $20 million.

“SB 313 is a significant step towards creating a fairer, more equitable economy,” said Judiciary Committee Chair Karl Rhoads, who introduced the bill. “This legislation pushes for those with the greatest resources to contribute their fair share to the prosperity of our state. By moving this bill forward, we are tackling inequality head-on and working to build an economy that benefits all, especially those who have been left behind for far too long.”

If the bill becomes law, individuals with assets worth more than $20 million would pay a state tax on the value of their assets above that amount. For example, if someone has $25 million in assets, they would pay the tax on the $5 million that exceeds the $20 million threshold. The tax rate would be 1%. The Committee adopted Chair Rhoads’ recommendation to assess the tax every three years.

SB 313 would include assets like real estate, stocks, bonds, cash, art and collectibles, in the calculation. Those subject to the wealth asset tax would report their assets to the Department of Taxation and pay the tax at the same time they file their regular state income taxes. If passed, the bill as amended would be applied to taxes due after Dec. 31, 2029.

Sen. Rhoads has introduced similar legislation in the past – SB 925 in 2023, and SB 2389 in 2022.

Massachusetts has already implemented a similar state wealth tax, with the money collected aimed at funding transportation and education programs, and other states are considering similar legislation.