STAND. COM. REP. NO. 2194
RE: S.B. No. 2968
Honorable Donna Mercado Kim
President of the Senate
Twenty-Seventh State Legislature
Regular Session of 2014
State of Hawaii
Your Committee on Tourism, to which was referred S.B. No. 2968 entitled:
"A BILL FOR AN ACT RELATING TO TOURISM STIMULUS INITIATIVES,"
begs leave to report as follows:
The purpose and intent of this measure is to provide a tax credit for hotel construction and renovation costs for taxable years beginning on January 1, 2015, and ending on December 31, 2020, against income taxes and transient accommodations taxes.
Your Committee received testimony in support of this measure from the Hawaii Tourism Authority, Hilton Grand Vacations Club, Hawaii Lodging and Tourism Association, American Resort Development Association, Wyndham Vacation Ownership, Maui Hotel and Lodging Association, and one individual. Your Committee received comments on this measure from the Department of Taxation and Tax Foundation of Hawaii.
Your Committee finds that tourism is Hawaii's principal industry, with visitor expenditures estimated to be over $15,000,000,000 in 2013. Your Committee further finds that investment incentives will revitalize the Hawaii tourism product, which includes physical infrastructure and hotel facilities. This measure will improve Hawaii's economy by encouraging hotel construction and renovation, which will create jobs and increase visitor spending in the long run.
Your Committee has amended this measure by:
(1) Removing the application of the tax credit against the transient accommodations tax under chapter 237D, Hawaii Revised Statutes;
(2) Authorizing the income tax credit for taxable years beginning on or after January 1, 2015, and ending on or before December 31, 2019;
(3) Removing the requirement that the construction or renovation costs be incurred after June 30, 2014, and before July 1, 2019; and
(4) Making technical, nonsubstantive amendments for the purposes of clarity and consistency.
As affirmed by the record of votes of the members of your Committee on Tourism that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 2968, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 2968, S.D. 1, and be referred to the Committee on Ways and Means.
Respectfully submitted on behalf of the members of the Committee on Tourism,
GILBERT KAHELE, Chair