How Does Hawaii's 4.712% GET Apply to Maritime Operators? A Plain-English Guide

If you run a charter operation, a tug, a dive boat, a freight barge, or any maritime business with a Hawaii address — or you sell marine services to Hawaii customers from anywhere — you owe Hawaii General Excise Tax (GET). Most mainland-relocated founders and a surprising number of local operators learn this the hard way, two to four years in, when the Department of Taxation (DOTAX) sends a letter.

GET is not a sales tax. That single misconception is the source of probably half the maritime-tax problems in this state. Sales tax is collected from the buyer and remitted. GET is owed by the seller on gross receipts, regardless of whether the buyer sees a separate line item. You can pass it through — most operators do — but the obligation is yours.

Here's what every Hawaii-based maritime business needs to know in plain English, with real numbers.

Why this matters in 60 seconds

GET applies to gross income from charter fees, passenger fares, freight, fuel sales, ship chandlery, marine services, brokerage commissions, vessel-management fees, marina slip rentals, and basically every dollar that flows into a Hawaii-based maritime business. Seller-side. Compounds annually if you don't file. The penalty stack — back-tax + interest + a 5%-per-month failure-to-file penalty up to 25% — is brutal.

I have personally seen a 3-vessel Maui dive operation that registered two years late hit with $18,000 in back-tax, interest, and penalties on roughly $80,000 of unreported revenue. They thought "marine services" were exempt. They were wrong.

The good news: registration is cheap ($20), the form is one page, and the filing rhythm is straightforward.

How GET works (the 90-second version)

The base GET rate is 4% statewide under HRS Chapter 237. On top of that, three counties add a 0.5% county surcharge (authorized under HRS 46-16.8 and locally enacted): Honolulu (Oahu), Hawaii (Big Island), and Kauai.

The math gets weird because the surcharge applies to the grossed-up amount when you pass it through. The published "visible" passthrough rates are:

• Oahu, Big Island, Kauai: 4.712% (this is the rate most operators talk about)
• Maui County (Maui, Molokai, Lanai): 4.4386% — Maui County has no county surcharge through 2027 per Hawaii Act 1, SLH 2018

Why 4.712 and not 4.5? Because if you charge a customer $100 and want to recover the full GET on $100 and the GET on the GET passthrough, you actually have to charge 4.712% on Oahu. The state publishes a GET passthrough calculator for exactly this reason.

Quick examples on Oahu (4.712%):

• $99/month SaaS: $99 + $4.66 GET = $103.66
• $850 sunset charter: $850 + $40.05 GET = $890.05
• $4,200 freight invoice: $4,200 + $197.90 GET = $4,397.90

The "passthrough or baked-in" decision

You have two pricing strategies:

1. Passthrough. Show the GET as a separate line item. "$99 base + $4.66 HI GET = $103.66." Honest, transparent, what most B2B services do.
2. Baked-in. Quote round numbers ($104 or $895) and absorb the GET into your stated price. Cleaner UX, slightly less margin per sale.

Charter operators usually pass through. SaaS and subscription businesses do too. Brick-and-mortar retail and tourism-facing services often bake in. There is no right answer — it's a margin decision and a customer-trust decision.

Registration: Form BB-1 and your GE Number

To register for GET (and most other Hawaii business taxes), file Form BB-1, Basic Business Application, online at hitax.hawaii.gov. The fee is $20. You'll receive a Hawaii Tax ID (also called a GE Number) within a few weeks.

You need to file BB-1 if you have any of:

• A Hawaii business address
• Hawaii employees
• A vessel documented or registered in Hawaii used commercially
• Customers in Hawaii (yes, even if you're a Delaware C-corp with no physical Hawaii presence)
• Inventory or property warehoused in Hawaii

That last bullet is the trap most mainland founders fall into. If you incorporated in Delaware, hired remote workers in Honolulu, and sell to a customer in California, you still might owe Hawaii GET. Talk to a Hawaii CPA before assuming otherwise.

Quarterly + annual filings: G-45 and G-49

Once registered, you file:

• Form G-45 quarterly (or monthly if your liability is high enough) — due by the 20th of the month following the period end. Q1 (Jan-Mar) is due April 20. This is your "as-you-go" payment.
• Form G-49 annually — due April 20 of the following year. This is your reconciliation. Adjust over/under-payments from the four G-45s.

Both forms are filed at hitax.hawaii.gov. Payments can be ACH, credit card, or check.

For a $99/mo SaaS doing $100k ARR, your G-45 quarterly liability is ~$1,178. Not nothing, but not painful if you've been collecting passthrough.

If your annual liability exceeds $4,000, you file G-45 monthly instead of quarterly. Above $100,000, you also file semi-annual estimated payments. For most small maritime operators, quarterly is the rhythm.

What's NOT exempt that you might think is

This is where operators get blindsided.

"Interstate freight is federal — exempt, right?"

No. If a freight invoice has any Hawaii nexus — origin, destination, or service performance — it's likely subject to GET. You can sometimes claim a partial exemption under the "wholesale" rate (0.5%) for re-sold services, but the default is full passthrough. Read HRS 237-13(2) carefully.

"Ship-to-ship fuel sales are duty-free"

Federal customs duty and Hawaii GET are different animals. A Honolulu fuel barge selling bunker fuel to a foreign-flag tanker is exempt from federal customs duty — but GET treatment depends on where title transfers and whether the transaction qualifies under specific HRS exemptions. Don't assume.

"Inter-island passenger fares aren't taxable, that's transportation"

Wrong. Inter-island passenger transportation is GET-able under HRS 237. The Public Service Company Tax applies to some carriers but doesn't replace GET for most charter and ferry operations.

"Charter party agreements are federal admiralty"

The contract is governed by federal admiralty law. The income from the contract is governed by Hawaii tax law if you're a Hawaii business.

"I just lease my boat to a captain"

Bareboat charter income is GET-able. If you receive money from anyone using your vessel, GET applies.

Foreign qualification: the Delaware C-corp trap

If you incorporated in Delaware (or any state outside Hawaii) and you're "doing business" in Hawaii — meaning you have employees, an office, or substantial activity here — you also need to register as a foreign entity with the Hawaii Department of Commerce and Consumer Affairs (DCCA).

This is a separate filing from BB-1. You file Form FO-49 (Application for Certificate of Authority for a Foreign Corporation) with DCCA, plus a $50 fee, plus a certificate of good standing from your home state. Then you file BB-1 with DOTAX. Then you file G-45 quarterly.

Operators who skip the DCCA registration sometimes get caught when they try to enforce a contract in Hawaii state court — courts won't enforce contracts for an unregistered foreign entity until you cure the registration and pay back fees. Cheaper to do it right at the start.

DOTAX audits: random and tip-driven

Hawaii Department of Taxation runs both random audits and tip-driven audits. Common triggers: a disgruntled former employee files a complaint, a competitor reports you (it happens), 1099-K data from payment processors shows revenue without matching G-45 filings, or you filed BB-1 but never filed G-45 (a "ghost" registration).

When an audit hits, DOTAX wants three years of records minimum: bank statements, customer invoices, vendor invoices, payroll records, and any 1099s. Be ready.

Common gotchas

1. Operating for years unregistered. The clock doesn't reset. Back-taxes plus 5%/month failure-to-file penalty (capped at 25%) plus interest. Voluntary disclosure programs exist — talk to a CPA before DOTAX finds you.

2. Using the wrong rate. A Big Island operator collecting 4% (state only) on Oahu sales is short-collecting and owes the difference out of pocket. Always check where the customer is located when the surcharge applies.

3. Confusing GET with sales tax. California, Texas, Washington — all have sales tax. Hawaii has GET. Different mechanic, different return form, different audit posture. Don't let your Stripe Tax integration assume Hawaii works like California.

4. Foreign qualification skip. Delaware C-corp doing business in Hawaii needs DCCA registration first, then BB-1. Skipping DCCA can void your ability to enforce contracts.

5. Forgetting the annual G-49 reconciliation. A surprising number of operators file G-45 quarterly all year and then forget G-49 in April. The annual form is what reconciles your year. Miss it and you're flagged.

What Binnacle does

Binnacle AI is built by a Hawaii operator and the GET math is baked into the product:

• Pricing transparency. Every invoice shows the GET passthrough as a separate line, with the applicable rate (4.712% Oahu / 4.4386% Maui) and the customer's billing-county on file.
• Customer GET reporting per state. Export your annual sales by jurisdiction for your CPA. No spreadsheet wrangling.
• G-45 / G-49 helper. Quarterly summary of taxable receipts, ready to feed into hitax.hawaii.gov. We don't file for you (we're not a tax preparer), but we make filing a 5-minute task instead of a 5-hour one.
• Multi-state ready. If you're a Hawaii business with mainland customers, our reports break out HI-source vs out-of-state revenue.

If you want to see exactly how the passthrough math shows up on a Binnacle invoice, the Binnacle pricing page walks through it line-by-line.

Start here

If you're operating without GET registration in Hawaii, this is the most-urgent compliance item in your business right now — more urgent than your COI, your insurance, your AIS subscription. The penalty meter is running.

Step 1: Talk to a Hawaii CPA. The Hawaii Society of CPAs directory is a starting point. Budget $300-$800 for a one-time setup conversation.

Step 2: File BB-1 at hitax.hawaii.gov. $20, one form, ~30 minutes.

Step 3: If you're a foreign entity, also file FO-49 with DCCA at business.hawaii.gov.

Step 4: Calendar your G-45 due dates: April 20, July 20, October 20, January 20. Plus G-49 by April 20 of the following year.

If you're already a Binnacle customer, GET passthrough is already configured on your billing. If you want to see whether your compliance stack has gaps, run our free calculator — it covers federal 46 CFR alongside state pieces:

[Try the free compliance calculator →](/compliance-calculator)

Under two minutes, real CFR citations. Pair it with a Hawaii CPA conversation and you'll close most compliance gaps in an afternoon.

Capt J is the founder of Binnacle AI. He runs a small maritime tech company on Oʻahu that builds compliance tools for commercial fleets. None of this article is legal or tax advice — consult a qualified Hawaii CPA and maritime attorney for specific regulatory and tax questions.