Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Second State Legislature

Regular Session of 2004

State of Hawaii

Sir:

Your Committee on Judiciary, to which was referred H.B. No. 2514 entitled:

begs leave to report as follows:

The purpose of this bill is to provide the Department of Taxation (DoTax) with the authority to impose civil penalties and injunctions on income tax return preparers who support unrealistic positions on tax returns and on promoters of abusive tax shelters.

DoTax testified in support of this bill. The Tax Foundation of Hawaii provided comments.

Your Committee finds that the provisions in this measure are consistent with the federal Internal Revenue Code and will provide DoTax with additional authority to punish those who assist taxpayers in evading their tax obligations.

Your Committee has amended this bill to make substantial changes in the format to ensure clarity and consistency with formatting used in state statutes.

As affirmed by the record of votes of the members of your Committee on Judiciary that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 2514, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 2514, H.D. 1, and be referred to the Committee on Finance.