SENATE FLOOR AMENDMENT

 

FLOOR AMENDMENT NO.   7 Date 03-09-04

TO: SB 1206, S. D. 1

SECTION 1. SB 1206, S. D. 1 is amended by deleting sections 1-4.

SECTION 2. SB 1206, S. D. 1 is amended by inserting the following:

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

"§235- . Windfall profits tax. (a) In addition to any other applicable tax imposed pursuant to this chapter, there is imposed on the distributors of petroleum products doing business in Hawaii, a windfall profits tax, that shall be applicable to profits earned from Hawaii business operations to the extent that such profits exceed twice the national industry average profit margin, as determined by the windfall profits advisory panel. The tax shall be equal to fifty per cent applied to the profits deemed to be excessive in accordance with this section.

(b) Moneys collected pursuant to this section shall be apportioned to the counties in accordance to the number of vehicles registered in each respective county. Each county shall receive such apportioned share on an annual basis.

(c) For purposes of this subsection:

"Cost of goods sold" shall include the cost of raw materials, i.e. oil, plus maintenance costs and operating expenses.

"Distributors of petroleum products" shall include individuals, partnerships, limited partnerships, joint ventures, trusts, associations, corporations, S corporations, or any other entity that is engaged in the business of refining, importing, distributing gasoline and other petroleum related products to retailers.

"Gasoline retailer" shall include individuals, partnerships, limited partnerships, joint ventures, trusts, associations, corporations, S corporations, or any other entity that is engaged in the business of selling gasoline to the consuming public.

"National industry average profit margin" shall mean the average profit margin of gasoline refiners in the United States as disclosed in industry reports, Moody's Investment Service, corporate annual reports or any other industry analytical source reports.

"Profit margin" shall mean the ratio of cost of goods sold to gross sales expressed as a percentage.

(d) There is established within the office of the state consumer advocate an advisory board consisting of five individuals. The members of the board shall be appointed by the governor from a list of eligible candidates submitted by the state consumer advocate, in accordance with chapter 26-34. The members of the board shall be:

(1) The state consumer advocate, who shall serve as its chairman;

(2) Two unaffiliated consumers of gasoline, who shall be members of the public at large;

(3) A gasoline retailer, who shall be engaged in the business of selling gasoline to the consuming public; and

(4) A seller of gasoline, who shall be either a refiner or importer of gasoline for resale.

The members of the board shall serve without compensation but shall be reimbursed for expenses, including travel expense, actually incurred in the performance of their duties under this chapter.

(e) The chairman of the board shall establish rules and guidelines for the board including the methodology to be used to calculate industry average profit margin.

(f) The duties of the board shall include:

(1) Review and analysis of national petroleum industry sales data; and

(2) Establishing a national industry average profit margin.

(g) The board shall meet once during the fourth quarter of each year.

(h) Meetings shall be conducted in accordance with Robert's Rules of Order.

(i) A simple majority of votes shall be required for decision making purposes.

(j) The consumer advocate shall publish the advisory panel's "national industry average profit margin" determination for public review.

(k) Any distributor of petroleum products violating this part, shall be subject to the fines and penalties provided in §231-39.

SECTION 2. New statutory material is underscored.

SECTION 3. This Act, upon its approval, shall apply to taxable years beginning after December 31, 2004."

 

 

 

 

 

 

 

 

 

Offered by: ___________________________ ( ) Carried

( ) Failed To Carry

( ) Withdrawn