Hawaii has the highest state income tax in the nation (up to 11% across 12 brackets), while Texas has zero state income tax. However, Hawaii has the lowest property tax in the nation (0.27%) while Texas has one of the highest (1.6-2.2%). A $200,000 earner saves approximately $15,000 per year in income tax moving to Texas, but pays $4,500+ more in property tax on a $300,000 home. Net savings: ~$10,500/year. The trade-off is stark: Hawaii's 'paradise tax' funds island infrastructure and beauty, while Texas relies on property taxes to fund state services. Best for high earners and renters; homeowners must calculate carefully.

By CountryTaxCalc Research Team

Last Updated: March 2026

The Big Picture

🌺 Hawaii

11%

Highest in Nation

12 progressive brackets from 1.4% - 11%

⭐ Texas

0%

No Income Tax

Constitutional prohibition on income tax

Typical Annual Savings

At $200,000 income:

$15,000

That is $1,250/month back in your pocket!

Tax Savings by Income Level

IncomeHI TaxTX TaxSavings10-Year
$50,000 $2,575$0$2,575$25,750
$75,000 $4,475$0$4,475$44,750
$100,000 $7,350$0$7,350$73,500
$150,000 $11,100$0$11,100$111,000
$200,000 $15,000$0$15,000$150,000
$300,000 $26,000$0$26,000$260,000
$500,000 $48,000$0$48,000$480,000

Hawaii Pros and Cons

✅ Pros

  • LOWEST property tax in nation (0.27%)
  • Year-round perfect weather (70-85°F)
  • World-class beaches and natural beauty
  • Strong military community and benefits
  • No daylight saving time

❌ Cons

  • HIGHEST income tax (11% top rate, 12 brackets)
  • Extremely high cost of living (40% above national avg)
  • Sales tax applies to more items (including services)
  • Isolation (expensive flights, limited shipping)
  • Limited job market outside tourism/military

Texas Pros and Cons

✅ Pros

  • 0% state income tax (constitutional)
  • Booming economy (Austin, Dallas, Houston)
  • Much cheaper housing than Hawaii
  • No tax on military pensions
  • Business-friendly (no franchise tax)

❌ Cons

  • High property taxes (1.6-2.2%, 6th highest nationally)
  • Hot, humid summers (100°F+ common)
  • Hurricane risk (Houston, coastal areas)
  • Urban sprawl (car-dependent)
  • Property tax increases can be steep
💡

CountryTaxCalc.com is reader-supported. When you use our partner links, we may earn a commission at no cost to you. This helps us provide free tax calculators and comparison tools. Learn more about our affiliate partnerships

Talk to a Real CPA

Taxhub

Moving from Hawaii to Texas? Multi-state returns are tricky—partial-year residency, different deadlines, avoiding double taxation. Get matched with a CPA who specializes in state moves. Virtual meetings, fixed pricing.

Get Matched With a CPA →

Frequently Asked Questions

Q: How much will I save moving from Hawaii to Texas?

Income tax savings are substantial: At $100K, save $7,350/year. At $200K, save $15,000/year. At $300K, save $26,000/year. However, Texas property tax is much higher. On a $300K home: Hawaii property tax = $810/year, Texas = $5,400/year (difference: $4,590). Net savings for $200K earner with $300K home: ~$10,400/year.

Q: What is the state income tax rate in Hawaii vs Texas?

Hawaii has 12 progressive tax brackets ranging from 1.4% to 11% (highest in the nation). Texas has no state income tax—it is constitutionally prohibited. Hawaii's 11% top rate kicks in at relatively low income levels compared to other high-tax states.

Q: Why does Hawaii have such high income tax but low property tax?

Hawaii's tax structure reflects its unique geography. As an isolated island state, it relies heavily on income tax (11% top rate) to fund infrastructure, schools, and services. Property tax is kept low (0.27%, lowest in nation) to make homeownership achievable despite extremely high home prices ($800K+ median). This 'paradise tax' model funds the island lifestyle but makes Hawaii unaffordable for many earners.

Q: What are the property tax differences between Hawaii and Texas?

Hawaii: 0.27% (LOWEST in nation). Texas: 1.6-2.2% (6th highest). On a $300K home: Hawaii = $810/year, Texas = $5,400/year. On a $500K home: Hawaii = $1,350/year, Texas = $9,000/year. Texas makes up for zero income tax with high property taxes. For high earners, the income tax savings still exceed the property tax increase.

Q: Is Texas sales tax higher than Hawaii?

Texas sales tax appears higher (6.25-8.25% vs Hawaii's 4%), but Hawaii's General Excise Tax (GET) is applied more broadly—including many services and intermediate business transactions. Both states have similar effective sales tax burdens, but Texas is slightly more transparent about what's taxed.

Q: Should military retirees move from Hawaii to Texas?

Yes, for most military retirees. Texas does not tax military retirement pay (0% income tax), while Hawaii taxes it at up to 11%. A military retiree with $60K pension saves $3,600/year in Hawaii income tax. Combined with lower overall cost of living in Texas (despite higher property tax), many Hawaii-based military members retire to Texas. Popular destinations: San Antonio (military-friendly), Austin, Dallas.

Q: Can I work remotely for a Hawaii employer while living in Texas?

Yes. If you're a Texas resident performing work physically in Texas, you pay 0% state income tax (Texas residency rules apply). Hawaii cannot tax non-residents on income earned outside Hawaii. This is a major opportunity: keep your Hawaii job, move to Texas, save $7K-$48K/year depending on income. Ensure you establish genuine Texas residency: TX driver's license, voter registration, lease, utility bills.

Q: At what income level does Texas win vs Hawaii?

For renters, Texas wins at every income level ($50K+). For homeowners, it depends on home value. Break-even example: $100K earner saves $7,350 income tax, but pays ~$3,000 more property tax on $300K home = net $4,350 savings. At $200K income, Texas saves $15,000 income tax vs ~$4,600 more property tax = net $10,400 savings. Texas wins decisively for earners over $100K.

Related Comparisons

Hawaii Tax CalculatorTexas Tax CalculatorCalifornia vs Texas TaxesNew Jersey vs Texas TaxesBest States for Taxes 2026Military Tax Guide