Report Title:

Tax Credit; New Jobs

Description:

Provides an income or general excise tax credit to companies that create new jobs.

HOUSE OF REPRESENTATIVES

H.B. NO.

1410

TWENTY-SECOND LEGISLATURE, 2003

 

STATE OF HAWAII

 


 

A BILL FOR AN ACT

 

RELATING TO tax credits.

 

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

SECTION 1. Chapter 235, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§235-    New employment tax credit. (a) Any taxpayer who files an individual or corporate income tax return for a taxable year may claim a new employment income tax credit under this section against the Hawaii state individual or corporate net income tax or the general excise tax under chapter 237.

(b) The tax credit claimed shall be equal to $1,000 for each net new full-time position created pursuant to this section; provided that the tax credit shall not exceed the limits under subsection (f).

(c) The tax credit shall first apply in the tax year in which the taxpayer increases net full-time employment by twenty-five or more jobs and in those subsequent tax years in which further net job increases occur above the level of employment established when the credit was last taken.

(d) To qualify for the tax credit:

(1) The position shall have been newly created in the State and not in existence in any business for at least ninety days prior to being created by the taxpayer;

(2) The position was filled during the tax year the tax credit is claimed and was in existence at the end of that tax year;

(3) The taxpayer has invested the required capital of $       and has satisfied other criteria as prescribed by rules adopted by the director pursuant to chapter 91, including filing a business plan with the director of taxation on or before the last day of the fiscal year in which the investment is made; provided that the business plan describe the investment made, the number of positions the investment will create, and the expected dates the positions will be filled; and

(4) The new full-time employee positions are filled prior to January 1, 2008.

(e) If the taxpayer's business is located in a state enterprise zone under chapter 209E, the tax credit shall be $2,000 for each net new full-time position created pursuant to this section.

(f) If the tax credit claimed by the taxpayer under this section exceeds the amount of the income tax or general excise tax payments due from the taxpayer, the excess of credit over payments may be carried forward until exhausted; provided that the total amount of the tax credit carried forward or claimed in any year shall not exceed the following:

Number of full-time positions Per cent of tax liability

at fiscal year end: offset by tax credit:

(1) Less than 100 33 1/3 per cent;

(2) 100 but less than 500 50 per cent;

(3) 500 but less than 2500 75 per cent;

(4) 2500 or more 100 per cent.

(g) The director of taxation shall prepare such forms as may be necessary to claim a credit under this section, may require proof of the claim for the tax credit, and may adopt rules pursuant to chapter 91 to effectuate this section.

(h) All of the provisions relating to assessments and refunds under this chapter and under section 231-23(c)(1) shall apply to the tax credit under this section.

(i) Claims for the tax credit under this section, including any amended claims, shall be filed on or before the end of the twelfth month following the taxable year for which the credit may be claimed."

SECTION 2. New statutory material is underscored.

SECTION 3. This Act shall take effect on July 1,     , and shall apply to taxable years beginning after December 31,     .

INTRODUCED BY:

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