STAND. COM. REP. NO. 2092

Honolulu, Hawaii

RE: S.B. No. 2614

S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Twenty-Ninth State Legislature

Regular Session of 2018

State of Hawaii

Sir:

Your Committee on Public Safety, Intergovernmental, and Military Affairs, to which was referred S.B. No. 2614 entitled:

"A BILL FOR AN ACT RELATING TO TAXATION,"

begs leave to report as follows:

The purpose and intent of this measure is to extend by one year the deadline for a county to adopt a surcharge on state tax, under certain conditions, from March 31, 2018, to March 31, 2019.

Your Committee received testimony in support of this measure from the Mayor, County of Hawaii; and Hawaii County Councilmember Eileen O'Hara. Your Committee received comments on this measure from the Department of Taxation; Mayor, County of Maui; and Tax Foundation of Hawaii.

Your Committee finds that in recent years, county budgets have tightened and therefore, it is important to provide the counties with every opportunity and reasonable means of generating funds to support important and necessary governmental infrastructure and services. However, your Committee understands the concerns raised in testimony by the Department of Taxation that the Department be given sufficient time to make necessary form and computer changes to begin levying, assessing, collecting, and otherwise administering the county surcharge on state tax should any county adopt an ordinance to establish such a surcharge.

Accordingly, your Committee has amended this measure by changing the date on which the Director of Taxation shall begin levying, assessing, collecting, and otherwise administering the county surcharge on state tax authorized under this measure to January 1, 2020.

As affirmed by the record of votes of the members of your Committee on Public Safety, Intergovernmental, and Military Affairs that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 2614, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 2614, S.D. 1, and be referred to your Committee on Ways and Means.

Respectfully submitted on behalf of the members of the Committee on Public Safety, Intergovernmental, and Military Affairs,

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CLARENCE K. NISHIHARA, Chair