Honolulu motorists could pay lower annual vehicle weight taxes starting in 2027 under a bill advanced Tuesday by the City Council’s Budget Committee.
Bill 47 would reduce the tax rate for passenger vehicles, including buses, ambulances, and hearses, from 6 cents per pound of net weight to 5.5 cents per pound. Trucks and noncommercial motor vehicles weighing 6,500 pounds or less that are not used for compensation or commercial purposes also would drop from 7 cents per pound to 5.5 cents per pound.
Commercial trucks and other vehicles designed to carry property would see rates fall from 7.5 cents per pound to 7 cents per pound.
The measure would partially reverse a 2019 increase enacted to raise city revenue. It would not change the city’s $12 minimum annual vehicle weight tax, registration procedures, eligibility rules for noncommercial classifications, or the categories used to set tax rates.
Registration costs vary by vehicle weight. According to the city Department of Customer Services, registering a 3,320-pound vehicle in Honolulu costs $364. About 895,140 vehicles are registered on Oahu.
The Department of Customer Services opposed the bill. Director Kim Hashiro said preliminary estimates showed it would reduce annual revenue by about $20 million to $30 million, depending on registrations and fleet composition. She said the loss would affect funding for roadway maintenance and could reduce local dollars used to help secure federal transportation funding.
Hashiro also said updating the city’s older vehicle registration computer system to implement the changes could be costly. She estimated customers with total registration fees of about $350 to $450 might see a reduction of roughly $40 to $50.
Council member Esther Kia‘aina raised the possibility of targeting relief to kupuna instead of all motorists. Hashiro said that “could work,” but the city would need to determine whether its records could identify eligible vehicle owners.
The committee recommended the bill for second reading by the full Council, which is scheduled to meet Aug. 12. If approved, the measure would take effect July 1, 2027.