H.B. 4 Summary

• Establishes a temporary small business income tax credit for qualified employers (25 or fewer full-time employees, gross income under $1,000,000) covering 50% of health care costs for employees earning under $25,000 annually and 25% for employees earning under $50,000, with a maximum credit of $50,000 per year.

• Increases Hawaii's minimum wage from $10.10 per hour (as of 2018) to $17.00 per hour by January 1, 2026, with scheduled increases: $11.50 (2022), $13.50 (2023), $14.50 (2024), $16.00 (2025), and $17.00 (2026).

• Implements an automatic cost-of-living adjustment to the minimum wage beginning September 30, 2026, calculated annually using the Urban Hawaii Consumer Price Index, rounded to the nearest twenty-five cents, with adjustments capped at no decrease from the previous year's rate.

• Repeals the tip credit provision that allowed tipped employees to be paid below minimum wage if tips supplemented their earnings.

• Small business tax credit applies to taxable years beginning after December 31, 2022, and expires June 30, 2027; effective date is July 1, 2021.