STAND. COM. REP. NO. 1784

                                 Honolulu, Hawaii
                                                   , 1999

                                 RE: S.B. No. 1421
                                     S.D. 1
                                     H.D. 2




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 S.B. No.
1421, S.D. 1, H.D. 1, entitled: 

     "A BILL FOR AN ACT RELATING TO TAXATION,"

begs leave to report as follows:

     The purpose of this bill is to enable the Department of
Taxation (DOTAX) to collect taxes that may otherwise be
uncollectible by allowing probation as a sentencing option for
income tax offenses.

     Currently, because the court can only impose a fine or a
term of imprisonment or both, it lacks the authority to obligate
the defendant to remit the taxes owed.  This bill will allow the
court to maintain jurisdiction over the defendant to ensure
payment of taxes as a condition of probation.

     The DOTAX, the Hawaii Society of Certified Public
Accountants, the Tax Section of the Hawaii State Bar Association,
and two individuals testified in support of this measure.  The
Tax Foundation of Hawaii offered comments.

     Your Committee has made technical, nonsubstantive amendments
to the bill to conform to correct drafting style.

     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 S.B. No.

 
 
                                 STAND. COM. REP. NO. 1784
                                 Page 2

 
1421, S.D. 1, H.D. 1, as amended herein, and recommends that it
pass Third Reading in the form attached hereto as S.B. No. 1421,
S.D. 1, H.D. 2.

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



                                   ______________________________
                                   DWIGHT Y. TAKAMINE, Chair