Hotels & Lodging in Honolulu, HI: What Residents Actually Need to Know

If you live in Honolulu or are thinking about moving there, hotels & lodging are one of those things you probably won't think about until they affect you directly. Honolulu has 3 specific rules on the books covering different aspects of hotels & lodging, and some of them might surprise you.

Transient Occupancy Tax

Hotels and short-term rentals on Oʻahu charge guests a county TAT (3%) layered atop the state TAT (10.25%) and General Excise Tax (4.712%), totaling roughly 18% on lodging — among the highest combined lodging taxes in the United States.

Key details: County TAT rate: 3% OTAT. State TAT rate: 10.25% (HRS §237D). GE Tax: 4.712% on Oʻahu. Combined lodging tax: ~17.96%. Authority: Ordinance 21-33.

Failing to register, collect, or remit OTAT triggers penalties up to 25% of unpaid tax plus interest, and willful evasion is a misdemeanor under Honolulu tax ordinances.

This is not one of those rules that cities tend to ignore. Honolulu actively enforces its transient occupancy tax requirements.

Hotel Worker Retention

Hawaiʻi enacted Act 1 (2021) requiring hotels and similar hospitality employers to recall laid-off workers by seniority when positions reopen, protecting Honolulu's tourism workforce from displacement after pandemic-era layoffs and ownership changes.

Key details: Authority: HRS §378-101 (Act 1). Covered workers: Hospitality laid off post-3/1/2020. Notice window: 5 days for vacancies. Recall basis: Seniority order.

Employers who skip the recall list face civil penalties, back wages, reinstatement orders, and attorney fees recoverable through DLIR complaints or court action.

Hotel Living Wage

Honolulu hotel workers earn wages set primarily through collective bargaining with UNITE HERE Local 5 and the statewide minimum wage law, since Hawaiʻi preempts city-set living wages and county pay floors above the state minimum.

Key details: Statewide floor 2026: $14.00 per hour. Floor by 2028: $18.00 per hour. Local preemption: HRS §387-9. Primary union: UNITE HERE Local 5.

Wage violations are pursued by the state Wage Standards Division, with back wages, civil penalties up to $500 per violation, and possible criminal charges for willful nonpayment under HRS §388.

The Bottom Line

Honolulu's hotels & lodging rules are a mixed bag. Some areas are strict, others are relaxed, and the details matter. The best approach is to check the specific rule that applies to your situation rather than assuming Honolulu is broadly strict or permissive.

All of the above reflects Honolulu's municipal code as of our last review. If you need specifics on fines, exemptions, or filing requirements, the detailed ordinance pages linked above have the full breakdown.