HI HB269

Amends Section 235-51 of Hawaii Revised Statutes to restructure capital gains tax treatment by creating separate provisions for resident, nonresident, and foreign taxpayers, effective for taxable years beginning after December 31, 2025.

For resident taxpayers with net capital gains, establishes a maximum tax rate of 7.25 percent on income above a threshold, compared to regular tax rates on income reduced by capital gains.

For nonresident taxpayers with net capital gains, establishes a maximum tax rate of 29 percent on income above a threshold.

For foreign taxpayers with net capital gains, establishes a maximum tax rate of 150 percent on income above a threshold.

Amends Section 235-71.5 to apply the same resident, nonresident, and foreign taxpayer distinctions to alternative capital gains tax calculations for corporations, regulated investment companies, and real estate investment trusts, with corresponding tax rates of 4 percent, 16 percent, and 150 percent respectively.