STAND. COM. REP. NO.928

Honolulu, Hawaii

, 2001

RE: S.B. No. 751

S.D. 1

H.D. 1

 

 

Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-First State Legislature

Regular Session of 2001

State of Hawaii

Sir:

Your Committee on Transportation, to which was referred S.B. No. 751, S.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO TAXATION,"

begs leave to report as follows:

The purpose of this bill is to allow interisland air carriers using certified quieter aircraft under an operating lease to claim a tax credit of an unspecified percentage of the lease rent paid to the lessor.

Hawaiian Airlines testified in support of the bill. The Department of Taxation and the Department of Budget and Finance testified in opposition to the bill. The Tax Foundation of Hawaii submitted comments on the bill.

While your Committee finds no compelling justification to single out the interisland air industry for preferential tax credit treatment, the importance of interisland air carriers cannot be denied. Accordingly, your Committee, after careful consideration, has amended this measure by deleting its contents and inserting the provisions of H.B. No. 1658 that exempts from general excise tax amounts received as rent for the rental or leasing of aircraft or aircraft engines used for interstate transportation of passengers and goods.

 

As affirmed by the record of votes of the members of your Committee on Transportation that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 751, S.D. 1, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 751, S.D. 1, H.D. 1, and be referred to the Committee on Finance.

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

____________________________

JOSEPH M. SOUKI, Chair