November 1, 1991


RE:  Taxation of Insurance Companies under the General Excise and Transient Accommodations Tax Laws

Effective January 1, 1992, Act 286, Session Laws of Hawaii (SLH) 1991, provides that the gross income or gross proceeds received by insurance companies as rents from investments in real property in Hawaii will be subject to the general excise tax under section 237-13(10), Hawaii Revised Statutes. Any gross income or gross proceeds received as rents under written contracts entered into before January 1, 1992, that do not provide for the passing on of taxes or tax increases will not be taxed until the contracts are renegotiated, renewed, or extended.

Act 286, SLH 1991, also provides that effective January 1, 1992, insurance companies are subject to the transient accommodations tax on their gross rental or gross rental proceeds derived from furnishing transient accommodations.

Form GEW-TA-3, Application for General Excise, Use, Employer's Withholding, and Transient Accommodations Identification Number, must be completed and filed by all insurance companies in order to:

  1. Apply for a general excise tax license. (A one-time license fee of $20 must be paid with the application).
  2. Register the transient accommodations.  (A one-time registration fee of $5 for each registration for transient accommodations consisting of one to five units and $15 for six or more units must be paid with the application).
For information or to request a copy of Act 286, SLH 1991, call the Department of Taxation, Technical Review Office at 587-1577.

Director of Taxation