Report Title:

General Excise Tax; Medical Services and Products

Description:

Excludes medical services and products from the general excise tax.

HOUSE OF REPRESENTATIVES

H.B. NO.

1242

TWENTY-SECOND LEGISLATURE, 2003

 

STATE OF HAWAII

 


 

A BILL FOR AN ACT

 

RELATING TO GENERAL EXCISE TAX.

 

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

SECTION 1. One of the greatest obstacles facing Hawaii's drive toward excellence in the new millenium is our burdensome and regressive tax system. The legislature finds that many residents of Hawaii face great difficulty affording the high cost of medical services and products. Part of the reason for the high cost of medical services and products in Hawaii is attributable to the general excise tax, which is passed on to the consumer or intermediary.

We all need medical services and products to survive and thrive. The disenfranchised – the elderly, the disabled, the sick, the poor, and our children – need medical services and products even more. Yet most live on fixed incomes, making the tax bite and final cost even more insidious.

The cost of basic human needs should not be a roadblock in our collective drive towards excellence. As a community, we cannot afford the impact of our regressive general excise tax system. The purpose of this bill is to remove medical services and products from the purview of the general excise tax.

SECTION 2. Chapter 237, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§237- Exemption for health care services and equipment. (a) There shall be exempted from, and excluded from the measure of, the taxes imposed by this chapter all of the gross proceeds or income arising from the provision of health care services or equipment.

(b) For purposes of this section, "health care services" means services involved in the diagnosis, cure, mitigation, treatment, or prevention of disease or the promotion of wellness of body when provided by one of the following types of facilities or people:

(1) Nonprofit or for-profit hospitals;

(2) Surgical outpatient facilities;

(3) Dialysis facilities;

(4) Infirmaries;

(5) Skilled nursing facilities;

(6) Intermediate care facilities;

(7) Adult residential care homes;

(8) Adult foster homes;

(9) Adult day care facilities;

(10) Assisted living facilities;

(11) Pharmacies;

(12) Sanitariums;

(13) Surface and air ambulances;

(14) Persons holding a valid license under chapters 442, 447, 448, 451A, 452, 453, 455, 457, 457A, 457G, 458, 459, 460, 461, 461J, 463E, 465, 466J, and 468E.

(c) As used in this section, "medical equipment" means any device, instrument, appliance, apparatus, or contrivance, electronic, mechanical, or otherwise, that is intended for the use in the diagnosis, cure, mitigation, treatment, or prevention of disease or the promotion of wellness of body when provided by one of the entities or persons listed in subsection (b) above."

SECTION 3. New statutory material is underscored.

SECTION 4. This Act shall take effect on January 1, 2004.

INTRODUCED BY:

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