STAND. COM. REP. NO. 874

                                 Honolulu, Hawaii
                                                   , 1999

                                 RE: H.B. No. 1198
                                     H.D. 1




Honorable Calvin K.Y. Say
Speaker, House of Representatives
Twentieth State Legislature
Regular Session of 1999
State of Hawaii

Sir:

     Your Committee on Finance, to which was referred H.B. No.
1198 entitled: 

     "A BILL FOR AN ACT RELATING TO THE INTEGRATED TAX
     INFORMATION MANAGEMENT SYSTEMS ACQUISITION BY THE DEPARTMENT
     OF TAXATION,"

begs leave to report as follows:

     The purpose of this bill is to create the Integrated Tax
Information Management Systems Special Fund (Special Fund) for
the operation, maintenance, monitoring, and improvement of
related automated tax systems.

     The Department of Taxation testified in support of this
bill.  The Tax Foundation of Hawaii commented on this bill.

     Your Committee has amended this bill by:

     (1)  Leaving blank all specific dollar amounts for the
          purpose of further discussion;

     (2)  Changing the effective date to July 1, 1999; and

     (3)  Making technical, nonsubstantive amendments for
          purposes of style and clarity.

     Your Committee has concerns regarding the linkage between
the Special Fund and the revenue source as it relates to the
contractual terms for the Integrated Tax Information System.

 
 
                                 STAND. COM. REP. NO. 874
                                 Page 2

 
     As affirmed by the record of votes of the members of your
Committee on Finance that is attached to this report, your
Committee is in accord with the intent and purpose of H.B. No.
1198, as amended herein, and recommends that it pass Second
Reading in the form attached hereto as H.B. No. 1198, H.D. 1, and
be placed on the calendar for Third Reading.

                                   Respectfully submitted on
                                   behalf of the members of the
                                   Committee on Finance,



                                   ______________________________
                                   DWIGHT Y. TAKAMINE, Chair