Dear Mr. Paxton, Pay Your Taxes

by Tom Yamachika, President, Tax Foundation Hawaii

Hawaii has no shortage of celebrity property owners. What I mean is that there are famous people who own property — sometimes a lot of property — here in Hawaii even though said famous people might not live here. You might have heard of Larry Ellison or Mark Zuckerberg or Oprah Winfrey. Maybe even Roseanne Barr.

And then there’s Ken Paxton. Yes, the Attorney General of Texas, candidate for Senator. He is the guy who, on behalf of Texas, sued Pennsylvania, Georgia, Michigan, and Wisconsin seeking to overturn their results in the 2020 presidential election. (The US Supreme Court tossed out his suit.). He also made news when four whistleblowers whom he fired won a $6.6 million judgment against his office for wrongful termination. (No skin off his back, though; Texas taxpayers wound up paying the tab.)

According to reporting from a nonprofit, university affiliated news organization in Texas, Mr. Paxton owns some property on Maui through a “blind trust,” meaning that he owns it, but someone else manages it for him, to cut down on possible conflicts of interest in his current position.

And the trust hasn’t paid his taxes.

According to Maui County property tax records, the real property tax for the first half of 2026 is due and unpaid. Some penalties and interest have been added.

The blind trust bought the property in October 2021. He’s had the property for a while and he had been paying property taxes on it until this year.

But, as readers of this column know all too well, the tax burden doesn’t stop there.

According to the Texas Tribune, the property was probably used a rental. Rental income is subject to our general excise tax, and perhaps our transient accommodations Tax if the rental was for fewer than 180 days.

Yet, in the Hawaii database of tax licensees which lists people and entities registered for GET, TAT, withholding, and other tax types, there is no Esther Blind Trust, or any name resembling it, to be found.

If there are GET and TAT taxes due and unpaid, the consequences may be severe. Folks who are required to file returns and pay taxes, but do neither, are routinely written up for 70% penalties. A 25% penalty is imposed for failure to file, another 25% for negligence, and another 20% for substantially underpaying taxes. In the federal system, you won’t see penalties this big because penalty stacking is limited. Not so under Hawaii’s tax laws.

To make things worse (for him), there is no statute of limitations to block the assessment. The statute of limitations starts running only if an annual return is filed. With no returns filed, all past years are open for assessment.

And this trust won’t be able to shrug off the tax, penalties, and interest by simply saying that it doesn’t have money to pay them. The Texas reporting says that the trust currently owns at least 15 properties with a total worth of about $9 million.

So, to our good friends at the Department of Taxation, we may have here some “low-hanging fruit.”

Celebrities should be following the law. They should be an example for the rest of us.

Sock it to ‘em, baby!