STAND. COM. REP. NO. 197-18

Honolulu, Hawaii

, 2018

RE: H.B. No. 2412

H.D. 1

Honorable Scott K. Saiki

Speaker, House of Representatives

Twenty-Ninth State Legislature

Regular Session of 2018

State of Hawaii

Sir:

Your Committee on Consumer Protection & Commerce, to which was referred H.B. No. 2412 entitled:

"A BILL FOR AN ACT RELATING TO INTOXICATING LIQUOR,"

begs leave to report as follows:

The purpose of this measure is to:

(1) Tax spirit beverage coolers based on the amount of alcohol content rather than the total liquid content by amending the definition of "cooler beverage" to include spirit beverage coolers, since cooler beverages are specifically excluded from the definitions of "beer," "distilled spirits," and "wine" under Liquor Tax Law; and

(2) Simplify the taxation scheme on beers by eliminating the distinction between draft beers and all other beers and simply taxing under one category, "beers."

Honolulu BeerWorks, Waikiki Brewing Company, Maui Brewing Company, Lanikai Brewing Company, Hawaiian Craft Brewers Guild, REAL a gastropub/Bent Tail Brewing Company, Beer Lab HI, Kauai Island Brewing Company, Kauai Beer Company, Kohola Brewery, Big Island Brewhaus, Homebrew in Paradise, Broken Boundary Brewery, LLC., and numerous individuals testified in support of this measure. The Hawai‘i Alcohol Policy Alliance testified in opposition. The Department of Taxation and Tax Foundation of Hawaii provided comments.

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

As affirmed by the record of votes of the members of your Committee on Consumer Protection & Commerce that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 2412, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 2412, H.D. 1, and be referred to your Committee on Finance.

Respectfully submitted on behalf of the members of the Committee on Consumer Protection & Commerce,

____________________________

ROY M. TAKUMI, Chair