Bill Text: HI HB1324 | 2018 | Regular Session | Amended
Bill Title: Relating To A Tax Credit For Interisland Transportation Of Agricultural Products Grown Or Processed In State Enterprise Zones.
Spectrum: Partisan Bill (Democrat 4-0)
Status: (Engrossed - Dead) 2017-11-30 - Carried over to 2018 Regular Session. [HB1324 Detail]
Download: Hawaii-2018-HB1324-Amended.html
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HOUSE OF REPRESENTATIVES |
H.B. NO. |
1324 |
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TWENTY-NINTH LEGISLATURE, 2017 |
H.D. 1 |
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STATE OF HAWAII |
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A BILL FOR AN ACT
RELATING TO A TAX CREDIT FOR INTERISLAND TRANSPORTATION OF AGRICULTURAL PRODUCTS GROWN OR PROCESSED IN STATE ENTERPRISE ZONES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. In 1978, voters approved article XI, section 3, of the Constitution of the State of Hawaii, which sets out the framework for state policies to promote agriculture and the conservation of productive agricultural lands in the State.
The legislature finds that there is a compelling need to provide mechanisms to fulfill the intent and purpose of article XI, section 3, of the state constitution and enable implementation of the constitutional mandate.
The legislature further finds that while land is the basic resource for agriculture and the supply of lands suitable for agriculture is an irreplaceable resource, the long-term viability of agriculture also depends on factors that affect the profitability of agriculture. One such factor is the availability and cost of transportation services. Hawaii's agricultural producers face operating costs that increasingly threaten the viability of their agricultural operations and the sustainability of agriculture in Hawaii.
The purpose of this Act is to authorize a tax credit equal to twenty per cent of the qualifying business costs for the transportation of agricultural commodities between the islands of the State.
SECTION 2. Section 209E-2, Hawaii Revised Statutes, is amended by amending the definition of "eligible business activity" to read as follows:
""Eligible business activity" means the:
(1) Manufacture of tangible personal property, the wholesale sale of tangible personal property as described in section 237-4, or a service business as defined in this section;
(2) Production and interisland transportation of agricultural products where the business is a producer as defined in section 237-5, or the processing of agricultural products, all or some of which were grown within an enterprise zone;
(3) Research, development, sale, or production of all types of genetically-engineered medical, agricultural, or maritime biotechnology products; or
(4) Production of electric power from wind energy for sale primarily to a public utility company for resale to the public;
provided that medical marijuana dispensary activities pursuant to chapter 329D shall not be considered an eligible business activity for the purposes of this chapter."
SECTION 3. Section 209E-10, Hawaii Revised Statutes, is amended to read as follows:
"§209E-10 State business tax credit. (a) The department shall certify annually to the department of taxation the applicability of the tax credit provided in this chapter for a qualified business against any taxes due the State. Except for the general excise tax, the credit shall be eighty per cent of the tax due for the first tax year, seventy per cent of the tax due for the second tax year, sixty per cent of the tax due for the third year, fifty per cent of the tax due the fourth year, forty per cent of the tax due the fifth year, thirty per cent of the tax due the sixth year, and twenty per cent of the tax due the seventh year. For qualified businesses engaged in the manufacturing of tangible personal property or the producing or processing of agricultural products, the credit shall continue after the seventh year at the rate of twenty per cent of the tax due for each of the subsequent three tax years. Any tax credit not usable shall not be applied to future tax years.
(b) When a partnership is eligible for a tax credit under this section, each partner shall be eligible for the tax credit provided for in this section on the partner's income tax return in proportion to the amount of income received by the partner from the partnership. Any qualified business having taxable income from business activity, both within and without the enterprise zone, shall allocate and apportion its taxable income attributable to the conduct of business. Tax credits provided for in this section shall only apply to taxable income of a qualified business attributable to the conduct of business within enterprise zones located within the same county.
(c) In addition to any tax credit authorized under this section, any qualified business shall be entitled to a tax credit against any taxes due the State in an amount equal to a percentage of unemployment taxes paid. The amount of the credit shall be equal to eighty per cent of the unemployment taxes paid during the first year, seventy per cent of the taxes paid during the second year, sixty per cent of the taxes paid during the third year, fifty per cent of the taxes paid during the fourth year, forty per cent of the taxes paid during the fifth year, thirty per cent of the taxes paid during the sixth year, and twenty per cent of the taxes paid during the seventh year. For qualified businesses engaged in the manufacturing of tangible personal property or the producing or processing of agricultural products, the credit shall continue after the seventh year in an amount equal to twenty per cent of the taxes paid during each of the subsequent three tax years.
(d) Tax credits provided for in subsection (c) shall only apply to the unemployment tax paid on employees employed at the qualified business' establishment or establishments within enterprise zones located within the same county. Any tax credit not usable shall not be applied to future tax years.
(e) In addition to any tax credit authorized under this section, any qualified business engaged in producing or processing agricultural products, for actual interisland transportation costs paid for transporting its agricultural products from one island to another island within the State, shall be entitled to a tax credit of twenty per cent of the transportation costs paid. The department shall certify to each taxpayer the amount of credit the taxpayer may claim. The department may require a taxpayer to furnish receipts that verify the actual costs paid and may adopt rules under chapter 91 to effectuate the certification requirements under this subsection."
SECTION 4. New statutory material is underscored.
SECTION 5. This Act shall take effect on July 31, 2150.
Report Title:
Taxation; Agricultural Products; Interisland; Tax Credit
Description:
Authorizes a tax credit equal to 20% of qualifying business costs for the transportation of agricultural commodities between islands within the State of Hawaii. (HB1324 HD1)
The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.
