Bill Text: HI SCR170 | 2013 | Regular Session | Introduced

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Bill Title: General Excise Tax; DOTAX Study of Specific Provision

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Engrossed - Dead) 2013-04-29 - The committee(s) on FIN recommend(s) that the measure be deferred. [SCR170 Detail]

Download: Hawaii-2013-SCR170-Introduced.html

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THE SENATE	S.C.R. NO.	170
TWENTY-SEVENTH LEGISLATURE, 2013
STATE OF HAWAII

SENATE CONCURRENT

RESOLUTION

 

 

dIRECTING THE dIRECTOR OF tAXATION TO REVIEW SECTION 237-25(c), hAWAII rEVISED STATUTES, TO DETERMINE IF THERE IS A RATIONAL BASIS FOR THE APPARENT DISPARITY BETWEEN THE APPLICATION OF THAT PROVISION AND OTHER SECTIONS OF CHAPTER 237, hAWAII REVISED STATUTES.

 

 

     WHEREAS, sections 237-14, 237-14.5, 237-18, 237-21, 237‑23(a)(7), and 237-23(b)(3), Hawaii Revised Statutes, allow taxpayers to segregate, divide, allocate, apportion, or specifically classify gross proceeds so as to apply different tax rates, or no tax at all, to determine the appropriate amount of excise tax due; and

 

     WHEREAS, the aforementioned sections are all of the sections in chapter 237, Hawaii Revised Statutes, that provide for specific classification and reporting of the gross proceeds as described therein except for section 237-25(c), Hawaii Revised Statutes; and

 

     WHEREAS, section 237-25(c), Hawaii Revised Statutes, provides as follows:

 

"(c)  Nothing in this section shall be deemed to exempt any person engaging or continuing in a service business or calling from any part of the tax imposed upon the person for such activity, and the person shall not be entitled to deduct any amount for tangible personal property furnished in conjunction therewith even though the person separately bills or otherwise shows the amount of the gross income of the business derived from the furnishing of the property" (emphasis added); and

 

     WHEREAS, section 235-25(c), Hawaii Revised Statutes, is directly contrary to all the other sections listed above in chapter 237, Hawaii Revised Statutes, which allow the segregation, division, allocation, apportionment, or specific classification of reported gross proceeds in order to apply different tax rates as appropriate; and

 

     WHEREAS, this body is concerned that this apparent disparity in the application of the law could cause legal problems for the State; and

 

WHEREAS, a government policy providing for fair and balanced application of tax law is beneficial to all of the people of Hawaii; and

 

     WHEREAS, in this era of technical capability, it is not a difficult task to segregate, divide, allocate, apportion, or specifically classify gross proceeds so as to apply different tax rates, or no tax at all, to determine the appropriate amount of excise tax due; now, therefore,

 

     BE IT RESOLVED by the Senate of the Twenty-seventh Legislature of the State of Hawaii, Regular Session of 2013, the House of Representatives concurring, that the Director Of Taxation is directed to review section 237-25(c), Hawaii Revised Statutes, to determine if there is any rational basis for the apparent disparity between the application of that provision and the aforementioned sections of chapter 237, Hawaii Revised Statutes; and

 

     BE IT FURTHER RESOLVED that if the Director of Taxation determines that there is no rational basis for the apparent disparity of application, the Director of Taxation is urged to administratively suspend the application of section 237-25(c), Hawaii Revised Statutes; and

 

     BE IT FURTHER RESOLVED that the Director of Taxation report findings and recommendations to the Legislature no later than twenty days prior to the convening of the Regular Session of 2014; and

 

     BE IT FURTHER RESOLVED that a certified copy of this Concurrent Resolution be transmitted to the Director of Taxation.

 

 

 

	OFFERED BY:	_____________________________

Report Title: 

General Excise Tax; DOTAX Study of Specific Provision