Proposed property tax change discriminatory
We believe the proposed property tax change targeting non-rental units in complexes that allow short-term rentals is discriminatory and probably illegal.
Federal constitutional rules generally require nonresidents to be taxed as favorably as residents.
We have been condo owners on Maui for 43 years and have never rented our unit, though rentals have been allowed. We spend approximately five months a year in Maui.
When we purchased our condo/home, we purchased with the understanding that we would not rent it and we would not be subject to rental property tax rates. We presently pay a tax rate of $5.45 per $1,000 — over twice the rate of those classified as owner-occupied who pay a tax rate of $2.51 per $1,000. With the change in tax classification, our property taxes will increase from $5.45 to as much as $16.41 per $1,000. The owner-occupied classification tax will remain much the same at $2.61 per $1,000. This is a massive tax subsidy by nonresidents for residents.
As part-time residents with no children in local schools and zero use of public services when not here, we will pay as much as 6.5 times more than an owner-occupied voting resident. Our new tax rate will increase by 300 percent.
Eliminating the non-owner-occupied category for those who do not rent their homes and own in complexes that allow short-term rentals forces us to pay taxes as if we were operating a rental business.
Robert and Carol Hickel