STAND. COM. REP. NO.796-02
Honolulu, Hawaii
, 2002
RE: S.B. No. 2907
S.D. 2
H.D. 1
Honorable Calvin K.Y. Say
Speaker, House of Representatives
Twenty-First State Legislature
Regular Session of 2002
State of Hawaii
Sir:
Your Committee on Economic Development and Business Concerns, to which was referred S.B. No. 2907, S.D. 2, entitled:
"A BILL FOR AN ACT RELATING TO TAXATION,"
begs leave to report as follows:
The purpose of this bill is establish a nonrefundable tax credit of up to $100,000,000 for investment expenses incurred in the development of facilities for attractions and educational purposes at Ko Olina Resort and Marina.
Specifically, this measure also:
(1) Allows the taxpayer to claim this credit against the tax liability imposed by the State income tax, as well as the general excise tax, transient accommodations tax, use tax, public service company tax, taxes on banks and other financial corporations, and taxes under the Insurance Code;
(2) Includes recapture provisions for costs incurred that no longer qualify for the tax credit; and
(3) Applies to investments made within the time period beginning after June 30, 2002, and before January 1, 2008.
The Hawaii Government Employees Association, Ko Olina Resort and Marina, The Estate of James Campbell, Armstrong Builders Ltd., 300 Corporation, and several concerned citizens supported this measure. The Department of Taxation and the Department of Budget and Finance opposed this bill. The Tax Foundation of Hawaii and Hawaii Coalition Against Legalized Gambling offered comments.
Your Committee believes that this measure will spur much-needed economic growth in the West Oahu area by supporting the development of the Ko Olina Resort and Marina, including the construction of a world-class aquarium. In the long run, this development should improve Hawaii's economy by promoting tourism and providing employment for many of Hawaii's workers. However, your Committee recognizes concerns raised regarding the revenue impact to the State of the tax credit contained in this bill.
Accordingly, your Committee has amended this measure by:
(1) Deleting the provisions allowing the tax credit to be applied against general excise tax liability; and
(2) Making technical, nonsubstantive amendments for purposes of style and clarity.
As affirmed by the record of votes of the members of your Committee on Economic Development and Business Concerns that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 2907, S.D. 2, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 2907, S.D. 2, H.D. 1, and be referred to the Committee on Finance.
Respectfully submitted on behalf of the members of the Committee on Economic Development and Business Concerns,
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____________________________ LEI AHU ISA, Chair |