REPORT TITLE:
G.E.T.; School Groups Exempt


DESCRIPTION:
Exempts from the general excise tax law all support groups
organized to benefit or assist the public schools.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                        
HOUSE OF REPRESENTATIVES                H.B. NO.843        
TWENTIETH LEGISLATURE, 1999                                
STATE OF HAWAII                                            
                                                             
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                   A  BILL  FOR  AN  ACT

RELATING TO SCHOOL SUPPORT GROUPS.



BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 1      SECTION 1.  Section 237-23, Hawaii Revised Statutes, is
 
 2 amended by amending subsection (a) to read as follows:
 
 3      "(a)  This chapter shall not apply to the following persons:
 
 4      (1)  Public service companies (as that term is defined in
 
 5           section 239-2), with respect to the gross income,
 
 6           either actual gross income or gross income estimated
 
 7           and adjusted, which is included in the measure of the
 
 8           tax imposed by chapter 239;
 
 9      (2)  Public utilities owned and operated by the State or any
 
10           county or other political subdivision thereof;
 
11      (3)  Fraternal benefit societies, orders, or associations,
 
12           operating under the lodge system, or for the exclusive
 
13           benefit of the members of the fraternity itself,
 
14           operating under the lodge system, and providing for the
 
15           payment of death, sick, accident, prepaid legal
 
16           services, or other benefits to the members of such
 
17           societies, orders, or associations, and to their
 
18           dependents;
 
19      (4)  Corporations, associations, trusts, or societies
 

 
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 1           organized and operated exclusively for religious,
 
 2           charitable, scientific, or educational purposes, as
 
 3           well as that of operating senior citizens housing
 
 4           facilities qualifying for a loan under the laws of the
 
 5           United States as authorized by section 202 of the
 
 6           Housing Act of 1959, as amended, as well as that of
 
 7           operating a prepaid legal services plan, as well as
 
 8           that of operating or managing a homeless facility, or
 
 9           any other program for the homeless authorized under
 
10           chapter 201G, part IV;
 
11      (5)  Business leagues, chambers of commerce, boards of
 
12           trade, civic leagues, agricultural and horticultural
 
13           organizations, and organizations operated exclusively
 
14           for the benefit of the community and for the promotion
 
15           of social welfare which shall include the operation of
 
16           a prepaid legal service plan, and from which no profit
 
17           inures to the benefit of any private stockholder or
 
18           individual;
 
19      (6)  Hospitals, infirmaries, and sanitaria;
 
20      (7)  Cooperative associations incorporated under chapter 421
 
21           or Code section 521 cooperatives which fully meet the
 
22           requirements of section 421-23, except Code section 521
 
23           cooperatives need not be organized in Hawaii; provided
 

 
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 1           that:
 
 2           (A)  The exemption shall apply only to the gross income
 
 3                derived from activities which are pursuant to
 
 4                purposes and powers authorized by chapter 421,
 
 5                except those provisions pertaining to or requiring
 
 6                corporate organization in Hawaii do not apply to
 
 7                Code section 521 cooperatives;
 
 8           (B)  The exemption shall not relieve any person who
 
 9                receives any proceeds of sale from the association
 
10                of the duty of returning and paying the tax on the
 
11                total gross proceeds of the sales on account of
 
12                which the payment was made, in the same amount and
 
13                at the same rate as would apply thereto had the
 
14                sales been made directly by the person, and all
 
15                such persons shall be so taxable; and
 
16           (C)  As used in this paragraph, "section 521
 
17                cooperatives" mean associations which qualify as a
 
18                cooperative under section 521 (with respect to
 
19                exemption of farmers' cooperatives from tax) of
 
20                the Internal Revenue Code of 1986, as amended;
 
21      (8)  Persons affected with Hansen's disease and kokuas, with
 
22           respect to business within the county of Kalawao;
 
23      (9)  Corporations, companies, associations, or trusts
 

 
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 1           organized for the establishment and conduct of
 
 2           cemeteries no part of the net earnings of which inures
 
 3           to the financial benefit of any private stockholder or
 
 4           individual (provided that the exemption shall apply
 
 5           only to the activities of such persons in the conduct
 
 6           of cemeteries and not to any activity the primary
 
 7           purpose of which is to produce income, even though the
 
 8           income is to be used for or in the furtherance of the
 
 9           exempt activities of such persons); [and]
 
10     (10)  Nonprofit shippers associations operating under part
 
11           296 of the Civil Aeronautics Board Economic
 
12           Regulations[.]; and
 
13     (11)  Groups that are organized to benefit or assist public
 
14           elementary, intermediate, and secondary schools within
 
15           the State, including parent-teacher associations,
 
16           parent-teacher-student associations, high school
 
17           booster clubs, and class alumni associations; provided
 
18           that the principal of the public school that the group
 
19           is organized to benefit or assist certifies annually in
 
20           writing to the director that the group, in fact, does
 
21           benefit and assist that school and is eligible for the
 
22           exemption under this paragraph." 
 
23      SECTION 2.  Statutory material to be repealed is bracketed.
 

 
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 1 New statutory material is underscored.
 
 2      SECTION 3.  This Act shall take effect on July 1, 1999.
 
 3 
 
 4                              INTRODUCED BY:______________________