In Hawaii, it's called the Department of Taxation, not the Department of Revenue. In looking through their
publication about the state's use tax, it seems pretty clear that you will have to pay 4 percent use tax on a car (new or used) that you bought from someone
* on the mainland. It also appears from looking at the
tax form that if you're trading another car in, you only have to pay use tax on the difference in value; however, it is not clear whether or not the trade-in must be to the same dealer/person where you bought the car.
Most states will help you through any forms and payment of such taxes at the DMV office when you go to transfer the title and register the car.
Also note that most states will not apply sales tax for the sale of a car to an out-of-state buyer. Thus, you might be paying 4 percent Hawaii use tax, but you probably won't have to pay sales tax to the state where the seller is located. (If you DO have to pay sales tax to another state, Hawaii will give you a credit towards the payment of the use tax.)
*Edit - As noted below, it is quite clear from this publication that you have to pay the use tax ONLY if you buy a car (new or used) from a dealer or person on the mainland who is in the business of selling cars, and NOT if you buy a used car from an individual who is not otherwise in the business of selling cars.
[This message has been edited by nsxtasy (edited 22 February 2003).]
