HI HB1586

Phases out county allocations of transient accommodations tax revenues over three years: $103 million for FY 2017-2018, $62 million for FY 2018-2019, and $31 million for FY 2019-2020, with all remaining revenues deposited into the state general fund beginning FY 2020-2021.

Establishes a zero percent income tax bracket for Hawaii residents earning up to $15,000-$17,500 (depending on filing status and year) and creates new progressive tax brackets phased in over three years through 2019.

Doubles the personal exemption amount from $1,144 to $2,288 for all taxpayers, effective for taxable years beginning after December 31, 1984.

Caps itemized tax deductions at $100,000-$200,000 depending on filing status, except charitable contributions remain uncapped and subject only to Internal Revenue Code limitations.

Effective dates vary by provision: transient accommodations tax changes effective July 1, 2017; income tax rate changes apply to taxable years beginning after December 31, 2017; personal exemption and itemized deduction changes apply to taxable years beginning after December 31, 2017.