Establishes a $500 per acre tax credit for new agricultural uses of fallow sugar lands and exempting related farm equipment purchases from the 4% GET for 2 years.

A BILL FOR AN ACT

SECTION 1. The legislature finds that it is beneficial to Hawaii's economy to encourage agricultural use of fallow sugar lands, and that increased farm activity in Hawaii will cause increased revenues to the State.

SECTION 2. Chapter 235, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§235- Tax credit for agricultural lands previously used for the production of sugar. (a) There shall be allowed for each taxpayer subject to the tax imposed by this chapter a tax credit for the agricultural use of lands previously used for the production of sugar which shall be claimed against the taxpayer's net income tax liability, if any, imposed by this chapter for the taxable year in which the credit is properly claimed.

(b) The amount of the tax credit shall be $500 per acre; provided that:

(c) This tax credit may be carried forward by the taxpayer for a period of up to five years."

SECTION 3. Chapter 237, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§237- Fallow sugar lands exemptions. This chapter shall not apply to amounts received from the sale of farm equipment purchased between January 1, 2001 and December 31, 2002, and used in connection with the agricultural use of fallow sugar lands."

SECTION 4. New statutory material is underscored.

SECTION 5. This Act shall take effect on July 1, 2001.