HB 232 Summary

• Repeals preferential tax treatment for capital gains income, taxing capital gains at the same rates as ordinary income for individuals, estates, and trusts.

• Eliminates section 235-51(f) of Hawaii Revised Statutes, which previously capped the tax on net capital gains at 7.25 percent.

• Projected to generate over $132 million in revenue in the next fiscal year, estimated to reach $187 million within six years.

• Applies to taxable years beginning after December 31, 2022.

• Intended to fund public programs including education, affordable housing, mental health services, childcare, tax credits for working families, and homeless services.