Honolulu, Hawaii



RE:    S.B. No. 2544

       S.D. 1




Honorable Shan S. Tsutsui

President of the Senate

Twenty-Sixth State Legislature

Regular Session of 2012

State of Hawaii




     Your Committee on Ways and Means, to which was referred S.B. No. 2544 entitled:




begs leave to report as follows:


     The purpose and intent of this measure is to repeal the temporary limit on the amount of itemized deductions that may be claimed for the purposes of state income tax by certain taxpayers, as established by Act 97, Session Laws of Hawaii 2011.


     Testimony in support of this measure was submitted by the University of Hawaii Foundation; Child and Family Services; Genoa Keawe Foundation Hawaii Music and Dance Hall of Fame, Papakolea Community; National Tropical Botanical Garden; Catholic Charities Hawaii; Agricultural Leadership Foundation of Hawaii; Hawaii Food Bank; Lanakila Pacific; Conservation Council of Hawaii; The Arc in Hawaii; Honolulu Museum of Art; Ola Hawaii 2020; and fifty-eight individuals.


     Testimony in opposition of this measure was submitted by four individuals.  The Tax Foundation of Hawaii submitted comments.


     Your Committee finds that charitable donations are an important source of funding for nonprofit and charitable organizations in Hawaii.  Your Committee also finds that the majority of itemized deductions that are claimed by taxpayers are for donations to charities and nonprofit organizations.  Your Committee further finds that eliminating the cap on itemized deductions will provide an additional incentive for persons to make donations to charitable and nonprofit organizations in the State.


     Your Committee has amended this measure by changing the effective date to July 1, 2050, to facilitate further discussion on the measure.


     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. 2544, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 2544, S.D. 1, and be placed on the calendar for Third Reading.


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