Hawaii's high taxes add to pricey cost of living, report says - KFVE, K5-Hawaii News, Weather and Sports

Hawaii's high taxes add to pricey cost of living, report says

(Image: Hawaii News Now/file) (Image: Hawaii News Now/file)
HONOLULU (HawaiiNewsNow) -

Add this to the reasons Hawaii is bad for your wallet: The state is one of the least tax-friendly states in the nation.

That's according to personal finance magazine Kiplinger, which put Hawaii at no. 7 in a list of least tax-friendly states.

“As Congress mulls a new federal tax plan that may cut rates and eliminate deductions, Americans should also keep an eye on state and local taxes,” Kiplinger managing editor Robert Long said, in a statement. “Depending on where you’re living, state income taxes and property taxes cost thousands of dollars every year.”

To compile its list, Kiplinger looked at a host of taxes in all 50 states, including income taxes, sales taxes, gas taxes, ‘sin’ taxes (tobacco, alcohol) and other tax rules and exemptions.

According to Kiplinger, Hawaii has the highest effective income tax rate of all 50 states.

Meanwhile, while Hawaii's average combined state and local sales tax is lower than other states, few purchases are exempt (as they are in other states).

Hawaii's gas taxes are the third highest in the US, Kiplinger said.

But one bright spot: Hawaii's property taxes as a percentage of home value are the lowest in the nation.

Maryland was named the least tax-friendly state in the country, followed by Minnesota.

The most tax-friendly state: Wyoming. There, the gas tax is well below the national average and there's no income tax. Meanwhile, prescription drugs and most groceries are exempt from sales taxes. 

Alaska took the no. 2 spot for most-friendly tax state, and South Dakota rounded out the top three.

Copyright 2017 Hawaii News Now. All rights reserved. 

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