STAND. COM. REP. NO. 20-20

Honolulu, Hawaii

, 2020

RE: H.B. No. 2346

H.D. 1

Honorable Scott K. Saiki

Speaker, House of Representatives

Thirtieth State Legislature

Regular Session of 2020

State of Hawaii

Sir:

Your Committee on Consumer Protection & Commerce, to which was referred H.B. No. 2346 entitled:

"A BILL FOR AN ACT RELATING TO TOBACCO PRODUCTS,"

begs leave to report as follows:

The purpose of this measure is to:

(1) Establish the offense of unlawful shipment of tobacco products;

(2) Tax and regulate e-liquid products and electronic smoking devices in the same manner as other tobacco products;

(3) Increase the license fee for persons engaged as a wholesaler or dealer of cigarettes and tobacco products;

(4) Increase the retail tobacco permit fee for retailers engaged in the retail sale of cigarettes and tobacco products; and

(5) Repeal various statutory provisions relating to electronic smoking devices made obsolete by this measure.

Your Committee received testimony in support of this measure from the Department of Taxation; Department of Health; Hawaii Pacific Health; Kapiolani Smokefree Families: Tobacco & Nicotine Cessation Program; Coalition for a Tobacco-Free Hawaii; Waianae Coast Comprehensive Health Center; American Cancer Society Cancer Action Network; American Heart Association; Hawaii Primary Care Association; Student Health Advisory Council of the University of Hawaii; Hawaii Women's Coalition; The Friends of Kamalani and Lydgate Park; We Are One, Inc.; Filipino Business Women's Association; Hawaii COPD Coalition; Americans for Democratic Action; and numerous individuals. Your Committee received testimony in opposition to this measure from the Retail Merchants of Hawaii, Hawaii Smokers Alliance, and three individuals. Your Committee received comments on this measure from the Tax Foundation of Hawaii and Hawaii Food Industry Association.

Your Committee has amended this measure by:

(1) Changing the effective date to July 1, 2050, to encourage further discussion; and

(2) Making technical, nonsubstantive amendments for the purposes of clarity, consistency, and style.

Your Committee notes that prior iterations of this measure in past legislative sessions have specified that certain dispositions of revenue from monies collected under the cigarette and tobacco taxes would go toward health education and prevention programs. Your Committee further notes that this measure does not propose any new dispositions of revenue of those taxes, but this is still under deliberation by the Department of Health. Should this measure be given further consideration as it progresses the legislative session, your Committee requests that those subsequent committees consider whether portions of the cigarette and tobacco taxes should be allocated toward health education and prevention programs.

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. 2346, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 2346, H.D. 1, and be referred to your Committee on Judiciary.

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

____________________________

ROY M. TAKUMI, Chair