THE SENATE	S.B. NO.	2593
THIRTIETH LEGISLATURE, 2020
STATE OF HAWAII

A BILL FOR AN ACT

relating to taxation.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

SECTION 1. The legislature finds that traffic congestion is a serious problem that negatively affects the quality of life for residents and visitors in Hawaii. Rental vehicle lessees make up a large proportion of public highway users and contribute to the wear and tear on Hawaii's roadways. Traffic congestion on the State's roadways continues to increase, forcing people to spend more time sitting in vehicles and less time being productive at work or with families and friends.

The legislature believes that it is reasonable to increase the rental motor vehicle surcharge tax in order to raise revenue for capital improvements to Hawaii's highways, which will relieve congestion and improve the quality of life for both residents and visitors.

The purpose of this Act is to amend the rental motor vehicle surcharge tax to fund projects to increase highway capacity and relieve traffic congestion.

Specifically, this Act:

(1) Increases the amount of the rental motor vehicle surcharge tax for such lessees for each day, or portion of a day, that a rental motor vehicle is rented to $6; and

(2) Requires that no less than one-third of remittances from each lessee shall be used for state highways with less than two lanes of travel in each direction.

SECTION 2. Section 251-2, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

"(a) There is levied and shall be assessed and collected each month a rental motor vehicle surcharge tax of [$5] $6 a day, or any portion of a day that a rental motor vehicle is rented or leased. The rental motor vehicle surcharge tax shall be levied upon the lessor; provided that the tax shall not be levied on the lessor if:

(1) The lessor is renting the vehicle to replace a vehicle of the lessee that is being repaired; and

(2) A record of the repair order for the vehicle is retained either by the lessor for two years for verification purposes or by a motor vehicle repair dealer for two years as provided in section 437B-16.

In addition to the requirements imposed by section 251-4, a lessor shall disclose, to the department, the portion of the remittance attributed to the county in which the motor vehicle was operated under rental or lease.

Of the remittances collected pursuant to this subsection, no less than one-third shall be used for state highways with less than two lanes of travel in each direction."

SECTION 3. Section 251-5, Hawaii Revised Statutes, is amended to read as follows:

"§251-5 Remittances. All remittances of surcharge taxes imposed under this chapter shall be made by cash, bank draft, cashier's check, money order, or certificate of deposit to the office of the taxation district to which the return was transmitted. The department shall deposit the moneys into the state treasury to the credit of the state highway fund[.]; provided that no less than one-third of each remittance under section 251-2 shall be used for state highways with less than two lanes of travel in each direction."

SECTION 4. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 5. This Act shall take effect upon its approval.

INTRODUCED BY:

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Report Title:

Rental Motor Vehicle Surcharge Tax; Increase; Counties; State Highway Fund

Description:

Increases the amount of the rental motor vehicle surcharge tax to $6. Requires that a minimum of one-third of remittances be used for state highways with less than two lanes of travel in each direction.

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.