STAND. COM. REP. NO. 1769

Honolulu, Hawaii

RE: H.B. No. 114

Honorable Ronald D. Kouchi

President of the Senate

Thirtieth State Legislature

Regular Session of 2019

State of Hawaii

Sir:

Your Committee on Ways and Means, to which was referred H.B. No. 114 entitled:

"A BILL FOR AN ACT RELATING TO AMENDING OR REPEALING HAWAII INCOME TAX LAWS FOR THE PURPOSE OF DELETING OBSOLETE OR UNNECESSARY PROVISIONS,"

begs leave to report as follows:

The purpose and intent of this measure is to repeal section 235-103, Hawaii Revised Statutes, which pertains to income tax law and is redundant to provisions of section 231-3.1, Hawaii Revised Statutes, and thus unnecessary.

Your Committee received comments on this measure from the Department of Taxation and Tax Foundation of Hawaii.

Your Committee finds that section 235-103, Hawaii Revised Statutes, which allows the Department of Taxation to determine the tax due on transactions for goods sold at less than fair market value, is redundant because section 231-3.1, Hawaii Revised Statutes, provides that consideration paid is not indicative of fair market value and applies to all taxes.

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 is in accord with the intent and purpose of H.B.

No. 114, and recommends that it pass Second Reading and be placed on the calendar for Third Reading.

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

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DONOVAN M. DELA CRUZ, Chair