Report Title:

General Excise Tax; Exemptions; Tourism

Description:

Provides a general excise tax exemption for amounts received for the provision of facilities and services for convention, meeting, and incentive program events that are paid for by national and international organizations.

HOUSE OF REPRESENTATIVES	H.B. NO.	756
TWENTY-FIFTH LEGISLATURE, 2009
STATE OF HAWAII

A BILL FOR AN ACT

relating to the general excise tax.

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

     SECTION 1.  The legislature finds that visitors to Hawaii for conventions, meetings, and incentive programs have decreased recently.  In 2006, conventions, meetings, and incentive program visitor days decreased by 5.7 per cent from 2005.

     The conventions, meetings, and incentive market is a highly competitive market with many destinations offering incentives to attract visitors for these events.  Mexico, for example, offers international conventions, meetings, and incentive events an exemption from the sales tax for conventions, meetings, and incentive sales paid for from a foreign bank.

     The legislature further finds that the conventions, meetings, and incentive market is a lucrative market with visitor spending of $913,000,000 in 2006, with an average daily spending of $210 per person, as compared to $178 per person for other visitors, and that incentives are necessary to allow Hawaii's visitor industry to remain competitive in the world market.

     The purpose of this Act is to provide an excise tax exemption for the provision of facilities and services for convention, meetings, and incentive events that are paid for by national and international organizations.

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

     "§237-   Conventions, meetings, and incentives. (a)  This chapter shall not apply to amounts received from provision of facilities and services for conventions, meetings, and incentive programs that are paid from an account in a foreign bank, a federal financial institution whose operations are not conducted in this State, or an out-of-state bank chartered under the laws of any state other than Hawaii.

(b)  As used in this section, "facilities and services" include:

(1) Meeting rooms;

(2) Exhibit areas;

(3) Airport or seaport transfers;

(4) Transportation between hotels and meeting places;

(5) Event services such as set-up, registration, translators, audiovisual equipment, decorations, security, and cleaning;

(6) Food and beverage services; and

(7) Services relating to the event up to two nights before the event and two nights after the event."

     SECTION 3.  New statutory material is underscored.

     SECTION 4.  This Act shall take effect on July 1, 2009.

INTRODUCED BY:

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