STAND. COM. REP. NO. 3271

Honolulu, Hawaii

RE:    S.C.R. No. 138

Honorable Ronald D. Kouchi

President of the Senate

Twenty-Eighth State Legislature

Regular Session of 2016

State of Hawaii

Sir:

     Your Committee on Ways and Means, to which was referred S.C.R. No. 138 entitled:

"SENATE CONCURRENT RESOLUTION REQUESTING THE TAX REVIEW COMMISSION TO EVALUATE THE IMPACTS OF GENERAL EXCISE AND USE TAX INCREASES PROPOSED DURING THE REGULAR SESSION OF 2016,"

begs leave to report as follows:

     The purpose and intent of this measure is to request the Tax Review Commission to conduct or commission a study that evaluates the impacts of general excise and use tax increases as proposed under Senate Bill No. 2599 and Senate Bill No. 2478, Regular Session of 2016.

     Your Committee received comments on this measure from the Department of Taxation.

     Your Committee finds that Senate Bill No. 2599 and Senate Bill No. 2478, Regular Session of 2016, proposed increases to the general excise and use tax to finance education programs and long-term care benefits, respectively.  However, certain impacts of each measure were not understood or fully discussed because of a lack of sufficient objective information.  Each measure was deferred during the Regular Session of 2016.

     Your Committee further finds that a Tax Review Commission is anticipated to be convened pursuant to Article VII, section 3, of the State Constitution.  A duty of the Tax Review Commission is to recommend revenue and tax policy.  Your Committee believes that a study conducted or commissioned by the Tax Review Commission that evaluates the impacts of general excise and use tax increases as proposed under Senate Bill No. 2599 and Senate Bill No. 2478, Regular Session of 2016, may provide the Legislature with sufficient objective information to fully consider these measures.

     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 concurs with the intent and purpose of S.C.R. No. 138 and recommends its adoption.

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

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JILL N. TOKUDA, Chair