STAND. COM. REP. 2592

Honolulu, Hawaii

, 2004

RE: S.B. No. 2983

S.D. 2

 

 

Honorable Robert Bunda

President of the Senate

Twenty-Second State Legislature

Regular Session of 2004

State of Hawaii

Sir:

Your Committee on Ways and Means, to which was referred S.B. No. 2983, S.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO CONFORMITY OF THE HAWAII INCOME TAX LAW TO THE INTERNAL REVENUE CODE,"

begs leave to report as follows:

The purpose of this measure is to conform the Hawaii income tax law to changes in the Internal Revenue Code.

The Department of Taxation is required under section 235-2.5, Hawaii Revised Statutes, to annually submit this measure to maintain state income tax conformity with the Internal Revenue Code with certain exceptions, including:

(1) Section 163(d)(4)(B), Internal Revenue Code, relating to the exclusion of dividends from investment income;

(2) Section 168, Internal Revenue Code, relating to increasing and extending the special bonus depreciation; and

(3) Sections 179(b)(1), 179(b)(2), 179(b)(5), 179 (c)(2), and 179(d)(1), Internal Revenue Code, relating to expensing depreciable business expenses.

This bill adopts changes in the Internal Revenue Code that include the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 and the Military Family Tax Relief Act of 2003.

Your Committee has amended the bill by making technical changes that have no substantive effect.

As affirmed by the record of votes of the members of your Committee on Ways and Means that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 2983, S.D. 1, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 2983, S.D. 2, and be placed on the calendar for Third Reading.

Respectfully submitted on behalf of the members of the Committee on Ways and Means,

____________________________

BRIAN T. TANIGUCHI, Chair