Lowers state tax on fuel; repeals chapter 486H.

A BILL FOR AN ACT

SECTION 1. Section 243-3.5, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

"§243-3.5 Environmental response tax; uses. (a) In addition to any other taxes provided by law, subject to the exemptions set forth in section 243-7, there is hereby imposed at times provided in section 128D-2 a state environmental response tax of [5] 2.5 cents on each barrel or fractional part of a barrel of petroleum product sold by a distributor to any retail dealer or end user, other than a refiner, of petroleum product; provided that 2 cents of the tax on each barrel shall be used pursuant to section 128D-2 to address concerns relating to drinking water. The tax imposed by this subsection shall be paid by the distributor of the petroleum product."

SECTION 2. Notwithstanding any law to the contrary, for tax years beginning after December 31, 2005, all state taxes imposed by chapter 243 shall be reduced by fifty per cent.

SECTION 3. Chapter 486H, Hawaii Revised Statutes, is repealed.

SECTION 4. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 5. This Act shall take effect on July 1, 2005, provided that section 2 shall be repealed on January 1, 2008.