STAND. COM. REP. NO. 1196

Honolulu, Hawaii

RE:    H.B. No. 1495

       H.D. 1

       S.D. 1

Honorable Colleen Hanabusa

President of the Senate

Twenty-Fifth State Legislature

Regular Session of 2009

State of Hawaii

Madam:

     Your Committee on Ways and Means, to which was referred H.B. No. 1495, H.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO STATE INCOME TAX,"

begs leave to report as follows:

     The purpose of this measure is to repeal the income tax deduction for wagering losses.

     One private organization submitted comments on this measure.  Written comments may be reviewed on the Legislature's website.

     Your Committee finds that the current economic difficulties faced by the State make it untenable to continue to allow the deduction of wagering losses against wagering income for the purposes of state income taxation.  Your Committee believes that this deduction deprives the State of revenue that could otherwise go to fund the delivery of essential state services.  Your Committee further finds that a repeal of the deduction will help the State's financial plan by reducing the current budget deficit.

     Your Committee has amended this measure by further changing the effective date to July 1, 2050, to facilitate further discussion.

     As affirmed by the record of votes of the members of your Committee on Ways and Means that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 1495, H.D. 1, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 1495, H.D. 1, S.D. 1, and be placed on the calendar for Third Reading.

Respectfully submitted on behalf of the members of the Committee on Ways and Means,

____________________________

DONNA MERCADO KIM, Chair