Report Title:

Tax returns; electronic filing

 

Description:

Provides DOTAX with the authority to require by rule, the electronic filing of tax returns.

 


THE SENATE

S.B. NO.

1504

TWENTY-FOURTH LEGISLATURE, 2007

 

STATE OF HAWAII

 

 

 

 

 

 

A BILL FOR AN ACT


 

 

RELATING TO ELECTRONIC FILING OF TAX RETURNS.

 

 

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

 


SECTION 1. With the advent of increased computer use personally and in daily business operations, electronic and computer-based interactions with government are ever rising.

As a government agency, the department of taxation interacts with nearly every person in Hawaii on a regular, systematic, and in-depth basis. The department of taxation also regularly interacts with nonresident taxpayers and mainland-based businesses that routinely file tax information with the department.

With the increase in out-of-state interaction with taxpayers and the increase in use of electronic means of filing tax information, the legislature in 1997 made electronic filing an acceptable means of carrying out a taxpayer's obligations under the law.

Since this law was enacted, the ability to interact electronically has grown considerably. This growth is even truer for businesses where almost every business has a computer and access to the internet.

The purpose of this Act is to provide the department of taxation with the authority to require by rule, electronic filing of certain tax returns. This Act is a natural progression of how a majority, if not all, of tax filings will be made in the next decade and beyond. To assure that taxpayers are provided with sufficient notice and an opportunity to comment, this Act requires compliance with chapter 91, Hawaii Revised Statutes.

The legislature, which is charged with the responsibility of overseeing the effectiveness of tax incentives and the efficacy of the tax system as a whole, can be provided more specific data on Hawaii taxes if the tax data were captured electronically.

Finally, the legislature finds that there are certain tax returns, such as fuel tax returns, tobacco tax returns, and other specific tax credits, that impact a very small number of taxpayers, all of whom likely have computer access. Allowing the department of taxation to require this small population of specific taxpayers to e-file tax returns will not adversely impact such taxpayers. Concomitantly, taxpayers will experience a commensurate decrease in the time it takes to process a return, including the processing of a tax refund.

SECTION 2. Section 231-8.5, Hawaii Revised Statutes, is amended to read as follows:

"[[]231-8.5[]Electronic filing of tax returns.  The department may allow or, by rule adopted pursuant to chapter 91, require filing by electronic, telephonic, or optical means of any tax return, application, report, or other document required under the provisions of title 14 administered by the department. The date of filing shall be the date the tax return, application, report, or other document is transmitted to the department in a form and manner prescribed by departmental rules adopted pursuant to chapter 91.  The department may determine alternative methods for the signing, subscribing, or verifying of a tax return, application, report, or other document that shall have the same validity and consequences as the actual signing by the taxpayer.  A filing under this section shall be treated in the same manner as a filing subject to the penalties under section 231-39."

SECTION 3. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 4. This Act shall take effect upon its approval.

 

INTRODUCED BY:

_____________________________

 

 

BY REQUEST