Hawaii Administrative Rules
Title 18 - DEPARTMENT OF TAXATION
Chapter 237D - TRANSIENT ACCOMMODATIONS TAX
Section 18-237D-1-05 - "Operator", defined
Current through February, 2024
(a) In general. An operator is any owner, proprietor, lessee, sublessee, mortgagee in possession, licensee, or any other person who is engaged in the business of actually furnishing transient accommodations. For the purposes of the tax imposed by this chapter, however, an operator shall be deemed synonymous with the person who is or should be licensed and required to pay the general excise tax imposed upon gross income or gross receipts derived from the actual furnishing of transient accommodations.
(b) Application to travel agents. Traditionally, a travel agent does not actually furnish transient accommodations. For the purposes of this chapter; therefore, a travel agent shall not be considered an operator unless the travel agent actually furnishes transient accommodations.
(c) Examples. Subsections (a) and (b) are illustrated as follows:
Example 1. Mr. Paul owns three apartment units and is engaged in the activity of furnishing transient accommodations. As owner and operator, Mr. Paul is liable for the tax imposed by this chapter.
Example 2. The facts are the same as in Example 1, except that Mr. Paul engages XYZ Corporation, a firm engaged in the property management business, to manage and rent out the apartment units. Although the apartments are managed and rented out by XYZ Corporation, as the owner and operator, Mr. Paul is liable for the tax imposed by this chapter.
Example 3. Hotel Corporation leases for a 55-year period a 300-unit apartment complex from Land Corporation. Hotel Corporation operates the apartment complex as a "hotel". As the lessee and operator, Hotel Corporation is liable for the tax imposed under this chapter, and the general excise tax imposed under chapter 237, HRS, on the gross rental or gross rental proceeds derived from the transient accommodations and apartment rental activities, respectively. As lessor, Land Corporation is subject to the general excise tax imposed under chapter 237, HRS, on the gross income or gross receipts derived from the activity of leasing the apartment complex to Hotel Corporation.
