Avalara MyLodgeTax > Blog > State and Local News > Finalized Big Island vacation rental rules go into effect

Finalized Big Island vacation rental rules go into effect

  • May 28, 2019 | Jennifer Sokolowsky


Hawaii County has adopted finalized rules governing short-term rentals on the Big Island. The county Planning Commission drafted the wording of the document, known as Rule 23, after the Hawaii County Council passed a new short-term rental law last year.

The law defined short-term vacation rentals as dwelling units with no more than five bedrooms for rent, rented for 30 consecutive days or less, where the owner does not live on site.

Under the new rules, adopted in April, new short-term vacation rentals are barred in single-family residential and agricultural zones and only allowed in hotel, resort, commercial, and multifamily commercial zones.

All vacation rentals must register with the county for a $500 fee and submit documents including:

  • Proof that all necessary building, electrical, and plumbing permits have been approved
  • Proof that taxes have been paid
  • Site and floor plans
  • Contact information for a “reachable person” available 24/7 in case of problems

Preexisting short-term rentals hoping to be grandfathered in under the new rules must apply by September 28.

Short-term rentals that have already been operating in barred zones may apply for a nonconforming use certificate in order to continue. The application includes submitting proof the rental has been operating as an “ongoing and lawful enterprise” on or before April 1, 2019. Vacation rental owners in nonconforming areas must also notify neighbors of their operations.

Approved short-term rental properties must follow noise, parking, and event regulations. The bill also requires vacation rental license numbers to be included in all advertisements.

As part of the permit process under the new rules, applicants must also submit current state General Excise Tax (GET) and Transient Accommodations Tax (TAT) licenses.

All vacation rentals throughout the state will be required to register for tax licenses and collect GET and TAT from guests if a bill recently passed by the Hawaii Senate is signed by Governor David Ige. The bill would also require vacation rental operators to include tax license numbers in all advertisements.

The state law would also require hosting platforms such as Airbnb and HomeAway to collect lodging taxes from guests of short-term rentals. The bill requires hosting platforms to register with state taxation authorities, collect taxes, and file regular tax returns with the state.

However, hosts would ultimately be responsible for collecting short-term rental taxes even if platforms collect on their behalf. MyLodgeTax can help vacation rental hosts comply with all lodging tax obligations. For more on tax compliance in Hawaii, see our state Vacation Rental Tax Guide.

Lodging tax rates, rules, and regulations change frequently. Although we hope you'll find this information helpful, this blog is for informational purposes only and does not provide legal or tax advice.
Avalara Author
Jennifer Sokolowsky
Avalara Author Jennifer Sokolowsky
Jennifer Sokolowsky writes about tax, legal, and tech topics. She has an extensive international background in journalism and marketing, including work with The Seattle Times, The Prague Post, Avvo, and Marriott.