Final answer:
In Hawaii, the tax rate for resort properties is typically higher compared to residential properties, reflecting the commercial nature and revenue potential of resorts.
Step-by-step explanation:
The variation in tax rates between resort properties and residential properties in Hawaii can be attributed to the distinct purposes and economic activities associated with each property type. Generally, resort properties tend to have higher tax rates compared to residential properties. This difference reflects the recognition that resorts are commercial entities designed for tourism and profit generation. The higher tax rate on resort properties acknowledges their potential for generating income and benefiting from the tourism industry.
Conversely, residential properties, which serve as homes for individuals or families, typically receive a more favorable tax rate. This reflects the recognition of the importance of housing for the local community and the different nature of contributions residential properties make to the community compared to commercial entities like resorts. The varied tax rates aim to align with the diverse roles and impacts of different property types on the local economy and community.