STAND. COM. REP. NO. 956

Honolulu, Hawaii

RE: S.B. No. 646

S.D. 2

Honorable Ronald D. Kouchi

President of the Senate

Thirty-First State Legislature

Regular Session of 2021

State of Hawaii

Sir:

Your Committee on Ways and Means, to which was referred S.B. No. 646, S.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO TAXATION,"

begs leave to report as follows:

The purpose and intent of this measure is to increase the rental motor vehicle surcharge tax in certain counties.

More specifically, this measure:

(1) Increases the rental motor vehicle surcharge tax from $5 per day to $8 per day for any county having a residential population of more than 125,000 but less than 195,000; and

(2) Allocates this increase in the rental motor vehicle surcharge tax to the applicable county's subaccount within the State Highway Fund.

Your Committee received written comments in support of this measure from Maui Chamber of Commerce.

Your Committee received written comments in opposition to this measure from Avis Budget Group and Enterprise Holdings.

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

Your Committee finds that this measure will enable the implementation of necessary highway upgrades in the affected counties.

Your Committee has amended this measure by:

(1) Codifying in section 251-5, Hawaii Revised Statutes, rather than section 251-2, Hawaii Revised Statutes, the requirement that, for a county having a residential population between 125,000 and 195,000, $3 out of every $8 collected for use of a rental motor vehicle in that county shall be deposited into that county's subaccount within the State Highway Fund; and

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

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 S.B. No. 646, S.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as S.B. No. 646, S.D. 2.

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

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DONOVAN M. DELA CRUZ, Chair