State-chartered credit unions in Hawaii are exempt from state franchise taxes and general excise tax (the equivalent of a state sales tax) on business purchases of personal property. Of the 97 credit unions domiciled in Hawaii, only three are state-chartered. Consequently, there has been no legislative effort to date to impose state taxes on those few state-chartered credit unions.
State and federal credit unions-as well as certain other not-for-profit entities in Hawaii-are also exempt from county-imposed real property taxes. Although most counties remain fiscally challenged, rising real estate assessments may yield sufficient revenue gains to mitigate the need for counties to repeal such tax exemptions. Nevertheless, the Hawaii Credit Union League and its chapters have been working diligently with county lawmakers to provide continuous justification for credit unions' real property tax exemptions to be maintained.
