Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Third State Legislature

Regular Session of 2005

State of Hawaii

Sir:

Your Committee on Finance, to which was referred S.B. No. 460 entitled:

begs leave to report as follows:

The purpose of this bill is to promote fairness in taxation administration by allowing taxpayers to:

The Chamber of Commerce of Hawaii, Hawaii State Bar Association Tax Section, Hawaii Society of Certified Public Accountants Tax Committee, National Federation of Independent Business - Hawaii, PriceWaterhouseCoopers LLP, Chun Kerr Dodd Beaman & Wong, and Horwath Kam & Company supported this bill. DOTAX opposed this measure. The Tax Foundation of Hawaii provided comments.

Your Committee recognizes the necessity for taxpayers to provide adequate information to support any refund claim and, therefore, urges DOTAX to develop applicable rules.

Additionally, your Committee notes that this measure is not intended to interfere with the current allowable time periods during which DOTAX is allowed to issue assessments.

After careful consideration, your Committee has amended this bill by clarifying that any refunds or credits appealed may only be awarded if those refunds or credits were claimed during the applicable statutory period of limitation.

As affirmed by the record of votes of the members of your Committee on Finance that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 460, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 460, H.D. 1, and be placed on the calendar for Third Reading.