STAND. COM. REP. NO. 3332

Honolulu, Hawaii

RE: H.B. No. 1494

H.D. 1

S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Thirty-First State Legislature

Regular Session of 2022

State of Hawaii

Sir:

Your Committee on Government Operations, to which was referred H.B. No. 1494, H.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO SPECIAL ENFORCEMENT SECTION,"

begs leave to report as follows:

The purpose and intent of this measure is to amend the purpose and duties of the Special Enforcement Section of the Department of Taxation.

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

Your Committee finds that a central mission of the Special Enforcement Section of the Department of Taxation is to close the gap between taxes owed and taxes paid. By some estimates this gap is approaching one billion dollars. The Special Enforcement Section promotes the uniform application of state tax law and is responsible for securing a significant amount of tax dollars on behalf of the public. Accordingly, this measure will benefit the State by clarifying the purpose and duties of the Special Enforcement Section.

Your Committee has amended this measure by repealing language that directed the Special Enforcement Section to prioritize the investigation of cash-based businesses.

As affirmed by the record of votes of the members of your Committee on Government Operations that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 1494, H.D. 1, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 1494, H.D. 1, S.D. 1, and be referred to your Committees on Ways and Means and Judiciary.

Respectfully submitted on behalf of the members of the Committee on Government Operations,

________________________________

SHARON MORIWAKI, Chair