Report Title:

General Excise Tax; Exemption; Basic Necessities and Services

Description:

Provides an exemption from general excise tax for basic necessities and services such as food, medicine, residential homes, medical services, dental services, and legal services.

THE SENATE	S.B. NO.	3199
TWENTY-FOURTH LEGISLATURE, 2008
STATE OF HAWAII

A BILL FOR AN ACT

relating to taxation.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

     SECTION 1.  The legislature finds that an exemption from general excise taxes for certain basic necessities and services would help to alleviate any potential economic recession in the United States that would subsequently lead to a reduction in employment rates and personal income in Hawaii.

     The purpose of this Act is to ease the general excise tax burden for the citizens and visitors of Hawaii by exempting from general excise taxes all sales and gross proceeds derived from certain basic necessities and services.

     SECTION 2.  Chapter 237, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

     "§237-  Exemption of certain basic necessities and services; definitions. (a)  Any provision of law to the contrary notwithstanding, there shall be exempted from, and excluded from the measures of, the tax imposed by this chapter all sales, and the gross proceeds of all sales, of the following basic necessities and services:

(1) Food;

(2) Residential home;

(3) Medicine;

(4) Medical services;

(5) Dental services; and

(6) Legal services.

(b)  As used in this section, the following terms shall have the following meanings:

"Food" means articles, or ingredients thereof, that are consumed by humans, dogs, or cats;

"Medical services" means every type of care, treatment, surgery, hospitalization, attendance, service, and supplies rendered or furnished by a licensed or certified physician, dispensing optician, physical therapist, nurse, or massage therapist; and

"Residential home" means a parcel of land, two acres or less in size, zoned for residential use, that is purchased or leased by an individual or family and is used or occupied or is developed, devoted, intended, or permitted to be used or occupied by that individual or family as their principal place of residence."

     SECTION 3.  New statutory material is underscored.

     SECTION 4.  This Act shall take effect on July 1, 2008.

INTRODUCED BY:

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