Honorable Robert Bunda

President of the Senate

Twenty-First State Legislature

Regular Session of 2001

State of Hawaii

Sir:

Your Committee on Ways and Means, to which was referred S.B. No. 992, S.D. 1, entitled:

begs leave to report as follows:

The purpose of this measure is to establish two cigarette tax stamp special funds for the administration of the cigarette tax stamp law, funded by portions of the stamp fee, and exempted from pro rata shares of central service expenses and administrative expenses.

Specifically, this measure creates the cigarette tax stamp enforcement special fund to assist the Department of the Attorney General in enforcing the cigarette tax stamp and the cigarette tax and tobacco tax law. Additionally, this measure creates the cigarette tax stamp administrative special fund to assist the Department of Taxation in providing the cigarette tax stamps.

In addition, this measure clarifies that the armed services exemption from the cigarette tax stamp does not apply to purchases for resale.

Finally, this measure transfers funds from the general fund to the two cigarette tax stamp special funds and makes appropriations out of those special funds.

Your Committee finds that this measure establishes two special funds to receive funds already designated for the enforcement and implementation of the cigarette tax stamp. The special funds will be used to support positions and expenses to enforce and implement cigarette tax stamping and related activities.

Your Committee has amended this measure by changing the appropriation amounts to one dollar each, and by making technical nonsubstantive amendments for the purposes of clarity and style and conforming to Ramseyer format drafting conventions.

As affirmed by the record of votes of the members of your Committee on Ways and Means that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 992, S.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as S.B. No. 992, S.D. 2.