Honolulu, Hawaii
                                                   , 1999

                                 RE: H.B. No. 232
                                     H.D. 2

Honorable Calvin K.Y. Say
Speaker, House of Representatives
Twentieth State Legislature
Regular Session of 1999
State of Hawaii


     Your Committee on Finance, to which was referred H.B. No.
232, H.D. 1, entitled: 


begs leave to report as follows:

     The purpose of this bill is to lower the cost of doing
business in Hawaii by establishing a new general excise tax (GET)
structure that retains the four percent tax on the final service
provided, and gradually, over a period of four years, lowers the
tax on intermediary services and wholesale goods to half a

     The Hawaii Business Roundtable, the Hawaii Society of
Certified Public Accountants, the Chamber of Commerce of Hawaii,
the Hawaii Farm Bureau Federation, the Tax Section of the Hawaii
State Bar Association, and the Honolulu Japanese Chamber of
Commerce testified in support of this measure.  The Department of
Taxation commented on this measure.

     Your Committee has amended this measure by providing for the
gradual implementation of the decrease in GET on intermediary
services and the sale of wholesale goods over a seven-year period
instead of over four years.

     As affirmed by the record of votes of the members of your
Committee on Finance that is attached to this report, your
Committee is in accord with the intent and purpose of H.B. No.

                                 STAND. COM. REP. NO. 1062
                                 Page 2

232, H.D. 1, as amended herein, and recommends that it pass Third
Reading in the form attached hereto as H.B. No. 232, H.D. 2.

                                   Respectfully submitted on
                                   behalf of the members of the
                                   Committee on Finance,

                                   DWIGHT Y. TAKAMINE, Chair