A practical guide to Hawaii's Motion Picture, Digital Media, and Film Production Income Tax Credit, including 22% to 27% base rates, the new 5% local-workforce uplift, the $60 million annual cap and how the refundable credit becomes cash.
Hawaii offers a refundable production tax credit equal to 22% of qualified costs incurred on Oahu and 27% of qualified costs incurred on the Neighbor Islands, including Maui, Kauai, Hawaii Island, Molokai and Lanai.
Beginning with qualified production costs incurred after December 31, 2025, a production whose workforce consists of at least 80% local hires may receive an additional 5 percentage points. That can raise the total credit to 27% on Oahu and 32% on the Neighbor Islands.
The program has a $60 million statewide annual cap. The standard per-production credit cap is $20 million, but that cap does not apply to a qualified production with at least $60 million in qualified production costs.
A production must generally spend at least $100,000 in qualified Hawaii production costs during the applicable tax year and submit its pre-production registration at least seven business days before the first Hawaii shoot date.
Hawaii combines location-based base rates with a new 2026 local-workforce uplift. Qualified projects should model each island's eligible costs separately.
Qualified production costs incurred on Oahu may receive the current 22% refundable base credit.
Qualified costs incurred on Maui, Kauai, Hawaii Island, Molokai or Lanai may receive the 27% refundable base credit.
Productions meeting the new 80% local-hire requirement may add 5 percentage points to the applicable base rate.
Hawaii requires pre-production registration, minimum qualified spending, state business registration, tax registration and final CPA certification.
A qualified production generally must incur at least $100,000 in qualified Hawaii production costs during the applicable tax year.
The pre-production registration must generally be submitted at least seven business days before the first Hawaii shoot date.
Productions must register to do business in Hawaii and obtain a Hawaii General Excise Tax license.
Act 185 requires each taxpayer claiming the credit to submit certification from an independent qualified CPA.
Hawaii uses pre-production registration, ongoing compliance, final CPA certification and state tax filing to complete the credit process.
Register the business in Hawaii, obtain the required GET license and prepare the production's budget, script and hiring plan.
File through the Hawaii Film Office portal at least seven business days before the first Hawaii shoot date. Select the 5% local-workforce uplift on the application if pursuing it.
Maintain payroll, vendor, residency, use-tax, loan-out withholding and other required production documentation.
Complete the required independent CPA certification, obtain final program documentation and claim the credit through the applicable Hawaii tax filing.
Hawaii's production incentive is a refundable income-tax credit. After the production completes the program's certification requirements and claims the credit on the applicable Hawaii tax return, eligible credit exceeding tax liability is refundable.
Hawaii provides refundable credits of 22% or 27%, with a new 5% local-workforce uplift for qualifying productions.
Hawaii law provides for eligible credit exceeding tax liability to be refunded to the taxpayer.
The program is structured around the taxpayer claiming a refundable credit, rather than monetizing through a general third-party credit market.
A separate state-purchase mechanism is unnecessary because the film credit itself is refundable.
If the $60 million statewide annual cap is reached, qualifying claims may move into the subsequent year's cap under current program guidance.
Complete certification, file the applicable Hawaii return and receive eligible excess credit as a refund.
The current statewide annual tax-credit cap is $60 million.
The standard per-production cap is $20 million, but it does not apply to qualified productions with at least $60 million in qualified production costs.
Because Hawaii operates under a statewide annual cap, producers should confirm current cap usage and expected claim-year timing before relying on projected proceeds.
Refundability avoids a private transfer discount, but final cash can still be affected by certified qualified costs, CPA fees, professional fees, financing, taxes and cap timing.
Hawaii currently limits aggregate Motion Picture, Digital Media, and Film Production Income Tax Credits to $60 million per year. If the cap is reached, qualifying productions may claim against the subsequent year's cap under current program guidance. Producers should confirm current cap usage and claim timing with the Hawaii Film Office before relying on projected proceeds.
Use the current Hawaii Film Office and Hawaii Department of Taxation guidance before making material production or financing decisions.
Compare Hawaii's 22% to 27% refundable base credit, new 5% local-workforce uplift, $60 million annual cap and island-specific rates with other U.S. film incentive programs.
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