The Honolulu City Council’s Budget Committee has recommended that the city increase the value of its homeowner property tax exemption by $20,000 starting July 1, 2028.
Honolulu currently has the lowest homeowner exemption in the state, as shown in the graph below.
Last year, the Council voted to increase the exemption to $140,000 from $120,000 for homeowners younger than 65 and to $180,000 from $160,000 for those 65 and older, effective July 1, 2027.
This year, it is considering Bill 45 (2026), which would increase the value of the home exemption for homeowners younger than 65 to $160,000, and Bill 46 (2026), which would increase the value of the exemption for those 65 or older to $200,000 from $180,000, both effective July 1, 2028.
The Grassroot Institute of Hawaii’s director of strategic campaigns, Ted Kefalas, testified that the pair of bills “would provide tax relief to Honolulu homeowners squeezed by increasing assessments.”
During the Committee’s July 14 meeting, Honolulu Budget and Fiscal Services Director Andy Kawano noted that a $20,000 increase in the value of the exemption would provide $70 in tax relief per year, at current tax rates.
Councilmember Tyler Dos Santos-Tam wondered whether the magnitude of the tax relief would have any effect.
“We are trying to deliver savings through this bill of $5.83 a month for local families,” he mused. “Is that what this comes down to?”
“That’s the math,” Kawano nodded.
Some testifiers also expressed dismay.
Honolulu resident Jonathan Huynh said that increasing the homeowner exemption “doesn’t touch why my property taxes keep climbing in the first place” because “Honolulu’s housing costs are driven by a chronic undersupply of homes.”
The bills’ introducer, Council Chair Tommy Waters, shared the story of a constituent worried about losing her home to higher property taxes.
“Mrs. Ikeda… was complaining to me about how her property taxes go up every year and she’s on a fixed income,” Waters said. “she’s afraid that if things don’t change, she’s going to have to sell. And that just was so sad to hear.”
Also during the meeting, Waters asked whether the Council should increase the exemption by “much, much more” so the city could provide even more tax relief.
“I’m open to a friendly Committee draft, if other members want to do so, to increase that,” he added.
Ultimately, however, the Committee did not amend the bills.
Kawano warned that the city would lose about $11 million in revenue from the two measures.
The measures now go back to the full Council for the second of three readings.
