STAND. COM. REP. NO. 1321-00

                                 Honolulu, Hawaii
                                                   , 2000

                                 RE: S.B. No. 2058
                                     S.D. 1
                                     H.D. 1




Honorable Calvin K.Y. Say
Speaker, House of Representatives
Twentieth State Legislature
Regular Session of 2000
State of Hawaii

Sir:

     Your Committee on Finance, to which was referred S.B. No.
2058, S.D. 1, entitled: 

     "A BILL FOR AN ACT RELATING TO INCOME TAX CREDITS,"

begs leave to report as follows:

     The purpose of this bill is to assist eligible low-income
workers by allowing these taxpayers to claim:

     (1)  Ten percent of the federal earned income tax credit for
          tax year 2000; and

     (2)  Fifteen percent of the federal earned income tax credit
          for tax year 2001 and beyond.

     The Hawaii State Commission on the Status of Women, Welfare
and Employment Rights Coalition, and the American Friends Service
Committee supported this bill.  The Department of Taxation
supported the intent of this bill.  The Tax Foundation of Hawaii
commented on this bill.

     Upon further consideration, your Committee has amended this
bill by:

     (1)  Leaving blank the percentages of the federal earned
          income tax credit that can be claimed for the State
          income tax; and 


 
 
                                 STAND. COM. REP. NO. 1321-00
                                 Page 2

 
     (2)  Making technical nonsubstantive changes for purposes of
          style and clarity.

     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.
2058, S.D. 1, as amended herein, and recommends that it pass
Second Reading in the form attached hereto as S.B. No. 2058, S.D.
1, 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