STAND. COM. REP. NO.  1659

Honolulu, Hawaii

                , 2009

RE:   S.B. No. 427

      H.D. 1

Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Fifth State Legislature

Regular Session of 2009

State of Hawaii

Sir:

     Your Committee on Finance, to which was referred S.B. No. 427 entitled:

"A BILL FOR AN ACT RELATING TO GENERAL EXCISE TAXATION,"

begs leave to report as follows:

     The purpose of this bill is to clarify that amounts received by a managed care support contractor for actual costs or advances to third party health care providers made pursuant to a contract for the administration of the federal TRICARE program are exempt from the general excise tax.

     TriWest Healthcare Alliance Inc., The Chamber of Commerce of Hawaii, and Hawaii Medical Service Association supported this bill.  The Tax Foundation of Hawaii submitted comments.

     Your Committee has amended this bill by:

     (1)  Changing the effective date to July 1, 2020, to encourage further discussion; and

     (2)  Making technical, nonsubstantive amendments for clarity, consistency, and style.

     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. 427, as amended herein, and recommends that it pass Third Reading in the form attached hereto as S.B. No. 427, H.D. 1.

Respectfully submitted on behalf of the members of the Committee on Finance,

____________________________

MARCUS R. OSHIRO, Chair