REPORT TITLE:
Tax; Cigarette, Liquor

DESCRIPTION:
Provides (blank percentages) for an increase of liquor and
cigarette taxes to be dedicated to the purchase of medical
equipment for Hawaii health system corporation's health
facilities and supporting early childhood development programs.
(SD1)

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                        1547
THE SENATE                              S.B. NO.           S.D. 1
TWENTIETH LEGISLATURE, 1999                                
STATE OF HAWAII                                            
                                                             
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                   A  BILL  FOR  AN  ACT

RELATING TO TAXES.



BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 1      SECTION 1.  Section 244D-4, Hawaii Revised Statutes, is
 
 2 amended by amending subsection (a) to read as follows:
 
 3      "(a)  Every person who sells or uses any liquor in the State
 
 4 not taxable under this chapter, [in respect of] with respect to
 
 5 the transaction by which the person or the person's vendor
 
 6 acquired the liquor, shall pay a gallonage tax which is hereby
 
 7 imposed [at the following rates] for the various liquor
 
 8 categories defined in section 244D-1[:
 
 9      For the period July 1, 1997, to June 30, 1998, the tax rate
 
10 shall be:
 
11      (1)  $5.92 per wine gallon on distilled spirits;
 
12      (2)  $2.09 per wine gallon on sparkling wine;
 
13      (3)  $1.36 per wine gallon on still wine;
 
14      (4)  $0.84 per wine gallon on cooler beverages;
 
15      (5)  $0.92 per wine gallon on beer other than draft beer;
 
16      (6)  $0.53 per wine gallon on draft beer;].
 
17      On July 1, [1998,] 1999, and thereafter, the tax rate shall
 
18 be:
 
19      (1)  [$5.98] $     per wine gallon on distilled spirits;
 

 
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 1      (2)  [$2.12] $     per wine gallon on sparkling wine;
 
 2      (3)  [$1.38] $     per wine gallon on still wine;
 
 3      (4)  [$0.85] $     per wine gallon on cooler beverages;
 
 4      (5)  [$0.93] $     per wine gallon on beer other than draft
 
 5           beer;
 
 6      (6)  [$0.54] $     per wine gallon on draft beer;
 
 7 and at a proportionate rate for any other quantity so sold or
 
 8 used."
 
 9      SECTION 2.  Section 244D-17, Hawaii Revised Statutes, is
 
10 amended to read as follows:
 
11      "[[]244D-17[]]  Disposition of revenues.  All moneys
 
12 collected pursuant to this chapter shall be paid into the state
 
13 treasury as state realizations, to be kept and accounted for as
 
14 provided by law[.]; except that of all revenues attributable to
 
15 the increase in tax rates effective July 1, 1999 using fiscal
 
16 year 1998-1999 as a baseline:
 
17      (1)       per cent shall be allocated to the Hawaii health
 
18           systems corporation under chapter 323F for the purpose
 
19           of purchasing medical equipment for its health
 
20           facilities; and
 
21      (2)       per cent shall be allocated to early childhood
 
22           development programs under the department of human
 
23           services or the department of education;
 

 
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 1 provided that the allocations in paragraphs (1) and (2) shall not
 
 2 reduce or eliminate any other allocation made through the budget
 
 3 process for the same purpose."
 
 4      SECTION 3.  Section 245-3, Hawaii Revised Statutes, is
 
 5 amended by amending subsection (a) to read as follows:
 
 6      "(a)  Every wholesaler or dealer, in addition to any other
 
 7 taxes provided by law, shall pay for the privilege of conducting
 
 8 business and other activities in the State an:
 
 9      (1)  Excise tax equal to[:
 
10           (A)  4.00 cents for each cigarette sold, used, or
 
11                possessed by the wholesaler or dealer, after
 
12                August 31, 1997; and
 
13           (B)  5.00]     cents for each cigarette sold, used, or
 
14                possessed by a wholesaler or dealer after June 30,
 
15                [1998,] 1999,
 
16           whether or not sold at wholesale, or if not sold then
 
17           at the same rate upon the use by the wholesaler or
 
18           dealer; and
 
19      (2)  Excise tax equal to [forty] ___ per cent of the
 
20           wholesale price of each article or item of tobacco
 
21           products sold by the wholesaler or dealer, whether or
 
22           not sold at wholesale, or if not sold then at the same
 
23           rate upon the use by the wholesaler or dealer.
 

 
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 1      Where the tax imposed has been paid on cigarettes or tobacco
 
 2 products which thereafter become the subject of a casualty loss
 
 3 deduction allowable under chapter 235, the tax paid shall be
 
 4 refunded or credited to the account of the wholesaler or dealer.
 
 5 In applying the tax, the tax shall be applied against the latest
 
 6 of the activities of selling, using, or possessing.  The tax
 
 7 shall be imposed at the time of the last of the following
 
 8 activities to occur:  the sale; the use; or the possession of
 
 9 cigarettes or tobacco products."
 
10      SECTION 4.  Section 245-15, Hawaii Revised Statutes, is
 
11 amended to read as follows:
 
12      "245-15  Disposition of revenues.  All moneys collected
 
13 pursuant to this chapter shall be paid into the state treasury as
 
14 state realizations to be kept and accounted for as provided by
 
15 law[.]; except that of all revenues attributable to the increase
 
16 in tax rates effective July 1, 1999, using fiscal year 1998-1999
 
17 as a baseline:
 
18      (1)       per cent shall be allocated to the Hawaii health
 
19           systems corporation under chapter 323F for the purpose
 
20           of purchasing medical equipment for its health
 
21           facilities; and
 
22      (2)       per cent shall be allocated to early childhood
 
23           development programs under the department of human
 

 
Page 5                                                     1547
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1           services or the department of education;
 
 2 provided that the allocations in paragraphs (1) and (2) shall not
 
 3 reduce or eliminate any other allocation made through the budget
 
 4 process for the same purpose."
 
 5      SECTION 5.  Statutory material to be repealed is bracketed.
 
 6 New statutory material is underscored.
 
 7      SECTION 6.  This Act shall take effect on July 1, 1999.