STAND. COM. REP. NO. 2101

Honolulu, Hawaii

RE: S.B. No. 2863

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 Commerce and Consumer Protection, to which was referred S.B. No. 2863 entitled:

"A BILL FOR AN ACT RELATING TO FEMININE HYGIENE PRODUCTS,"

begs leave to report as follows:

The purpose and intent of this measure is to exempt the sale of feminine hygiene products from the general excise tax.

Your Committee received testimony in support of this measure from the Hawai‘i State Council on Developmental Disabilities, Hawaii Food Industry Association, Health Committee of the Democratic Party of Hawai‘i, Stonewall Caucus of the Democratic Party of Hawai‘i, Pono Hawai‘i Initiative, Ma‘i Movement Hawai‘i, Alliance for Period Supplies, and eleven individuals. Your Committee received comments on this measure from the Department of Taxation, Department of Budget and Finance, and Tax Foundation of Hawaii.

Your Committee finds that feminine hygiene products are a necessary living expense for menstruating people. The general excise tax is typically applied to all goods and services, making it a highly regressive tax system that disproportionately impacts lower income Hawaii consumers. Research has shown that twenty-five percent of women and students have struggled to purchase enough menstrual products. This lack of a basic necessity can force women to stay home from work or school, thereby reducing wages and socio-economic productivity, and can force families to have to choose between purchasing the products they need or purchasing food, putting their health in jeopardy. There are several other products and services that are allowed a general excise tax exemption because of their healthful properties. Because people need menstrual products to stay healthy and avoid risk of infection, removing the burden of the general excise tax on these items will help prevent additional unnecessary medical costs. This measure will further align Hawaii with twenty-three other states that do not charge sales tax on period products.

Your Committee has amended this measure by:

(1) Inserting an effective date of January 1, 2023; and

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

As affirmed by the record of votes of the members of your Committee on Commerce and Consumer Protection that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 2863, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 2863, S.D. 1, and be referred to your Committee on Ways and Means.

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

________________________________

ROSALYN H. BAKER, Chair