STAND. COM. REP. NO.  823

Honolulu, Hawaii

                , 2017

RE:   H.B. No. 690

      H.D. 1

Honorable Joseph M. Souki

Speaker, House of Representatives

Twenty-Ninth State Legislature

Regular Session of 2017

State of Hawaii

Sir:

     Your Committee on Finance, to which was referred H.B. No. 690 entitled:

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

begs leave to report as follows:

The purpose of this measure is to amend State income tax brackets and rates by:

     (1)  Decreasing income tax rates by approximately 25 percent for all but the top income earners; and

     (2)  Reinstating higher income tax brackets and rates similar to those that were repealed on December 31, 2015.

Hawaii Women's Coalition and IMUAlliance testified in support of this measure.  The Chamber of Commerce Hawaii testified in opposition.  The Department of Taxation, Tax Foundation of Hawaii, and Hawaii Appleseed Center for Law and Economic Justice provided comments.

     Your Committee has amended this measure by:

     (1)  Clarifying the tax rates imposed on each tax bracket;

     (2)  Changing its effective date to July l, 2030, to encourage further discussion; and

     (3)  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 H.B. No. 690, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 690, H.D. 1, and be placed on the calendar for Third Reading.

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

____________________________

SYLVIA LUKE, Chair