THE SENATE	S.C.R. NO.	163
TWENTY-FOURTH LEGISLATURE, 2008
STATE OF HAWAII

SENATE CONCURRENT

RESOLUTION

REQUESTING THE DEPARTMENT OF TAXATION TO EXamine the payment of GENERAL EXCISE TAXES on ALL COMMISSIONS EARNED from sales BY A MANUFACTURER'S sales REPRESENTATIVE of IMPORTED TANGIBLE PERSONAL PROPERTY THAT is PURCHASED by a consumer directly FROM THE MANUFACTURER.

     WHEREAS, the payment of general excise taxes by taxpayers is the State's largest source of revenue; and

     WHEREAS, the general excise tax on commissions earned from sales of imported tangible personal property by sales representatives of manufacturers who are in the construction industry annually amounts to over $2,200,000 in general excise tax revenues; and

     WHEREAS, some sales representatives operating in Hawaii are the sole, or exclusive, representative of a specific manufacturer; and

     WHEREAS, those sole, or exclusive, sales representatives are often under the control and authority of the manufacturer they represent, thus the sales representative is acting in the capacity of an employee of the manufacturer whereby the manufacturer should be assessed general excise taxes on sales of imported tangible personal property, rather than the sales representative; and

     WHEREAS, the Legislature would benefit greatly from a report by the Department of Taxation that analyzes the fiscal impact and payment of general excise taxes on commissions earned by manufacturer sales representatives when consumers purchase imported tangible personal property directly from the manufacturer; now, therefore,

     BE IT RESOLVED by the Senate of the Twenty-fourth Legislature of the State of Hawaii, Regular Session of 2008, the House of Representatives concurring, that the Department of Taxation is requested to analyze the payment of general excise taxes on commissions earned by sales representatives of manufacturers from the sales of imported tangible personal property; and

     BE IT FURTHER RESOLVED that the Department of Taxation is requested to openly communicate with sales representatives of manufacturers in the construction industry and progress toward a fair and adequate resolution to the tax issues surrounding the payment of general excise taxes by the sales representatives from sales of imported tangible personal property; and

     BE IT FURTHER RESOLVED that the Department of Taxation is requested, during its 2008 workshops on tax law changes, to investigate the fiscal impact of general excise taxes on commissions earned from sales by a manufacturer's sales representative of imported tangible personal property that is purchased by a consumer directly from the manufacturer; and

     BE IT FURTHER RESOLVED that the Department of Taxation is requested to report its findings on the fiscal impact and payment of general excise taxes on commissions earned from sales by a manufacturer's sales representative of imported tangible personal property that is purchased by a consumer directly from the manufacturer to the Legislature no later than twenty days prior to the convening of the 2009 Regular Session; and

     BE IT FURTHER RESOLVED that certified copies of this Concurrent Resolution be transmitted to the Governor of the State of Hawaii and the Director of Taxation.

OFFERED BY:

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Report Title: 

General Excise Tax; Manufacturer's Representative; Commissions