Additional 3% Tax to be Applied to Kauai Vacation Rental & Hotel Bookings

Sean Ahearn

Kauai County Bill 2829 was signed into law, which establishes a 3% Transient Accommodations Tax program for the County of Kaua‘i. Now referred to as Ordinance 1099, this 3% TAT will apply to all gross resorts, hotel rentals, and short-term transient rentals. It also applies to travel agencies, visitor brokers, and tour packagers who arrange transient accommodations at noncommissioned contracted rates.

This new ordinance will now allow Kauai to supplement the many state and tourism-related activities that are funded by our county taxpayers. This supposedly will replace what we used to get from the state for transient accommodations. The state usually pulls in about $103 million from its 10.25% TAT, of which a fragment would then be dealt out to the counties. In the wake of the pandemic, and seeing its own budget deficits, distribution ceased. This new state law will give each county the ability to establish its own visitor-accommodation tax of up to 3%. 

With this new ordinance in place, a rental listed at $100 a night rate will now cost a renter close to $118 including all taxes. That's adding together the current State TAT at 10.25%, the new County TAT at 3%, plus 4.5% general excise tax. The new ordinance will go into effect on October 1st, 2021. For more information on the new county TAT, visit kauai.gov/tat

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For more information about local happenings on Kauai, or to inquire specifically about Kauai real estate, you can reach us at:
 
Sean Ahearn & Jim Karlovsky
aloha@akkauai.com
(800) 808-6373

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