HOUSE OF REPRESENTATIVES

H.B. NO.

1850

TWENTY-EIGHTH LEGISLATURE, 2016

H.D. 1

STATE OF HAWAII

S.D. 3

 

 

 

 

 

A BILL FOR AN ACT

 

 

RELATING TO TAXATION.

 

 

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

 


SECTION 1. The legislature finds that, under certain circumstances, allowing a private person to act as a tax collection agent is likely to ease the burden of collecting taxes. Section 237-9, Hawaii Revised Statutes, allows a person engaged in network marketing, multi-level marketing, or other similar business to enter into an agreement with the department of taxation to act as a tax collection agent on behalf of its direct sellers. The legislature finds that similarly allowing a transient accommodations broker to act as a tax collection agent on behalf of providers of transient accommodations that utilize the services of the transient accommodations broker may facilitate the collection of transient accommodations taxes and general excise taxes.

The purpose of this Act is to allow a transient accommodations broker to register to act as a tax collection agent with respect to transient accommodations taxes and general excise taxes for its operators and plan managers in a manner that recognizes the dynamic changes that are occurring in the transient accommodations business.

SECTION 2. Chapter 237, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"237-   Transient accommodations broker as tax collection agent. (a) The director may permit a transient accommodations broker to register as a tax collection agent on behalf of all of its operators and plan managers by entering into a tax collection agreement with the director or by submitting a transient accommodations broker tax collection agent registration statement to the director.

The director may deny an application for registration as a transient accommodations broker tax collection agent under this section for any cause authorized by law, including but not limited to any violation of this chapter or rules adopted pursuant thereto, violation of any prior tax collection agreement, or failure to meet minimum criteria that may be set forth by the department in rules adopted pursuant to chapter 91.

Execution of a tax collection agreement shall not be a requirement for registration as a transient accommodations broker tax collection agent.

The director shall issue a certificate of registration or letter of denial within thirty days after a transient accommodations broker submits to the director a completed and signed transient accommodations broker tax collection agent registration statement, in a form prescribed by the department. The registration shall be valid only for the transient accommodations broker tax collection agent in whose name it is issued, and for the website or platform designated therein, and shall not be transferable.

A registered transient accommodations broker tax collection agent shall be issued separate licenses under this chapter with respect to taxes payable on behalf of its operators and plan managers in its capacity as a registered transient accommodations broker tax collection agent and, if applicable, with respect to any taxes payable under this chapter for its own business activities.

(b) In addition to its own responsibilities under this chapter, a registered transient accommodations broker tax collection agent shall report, collect, and pay over the taxes due under this chapter on behalf of all of its operators and plan managers from the date of registration until the registration is canceled as provided in subsection (h); provided that the registered transient accommodations broker tax collection agent's obligation to report, collect, and pay taxes on behalf of all of its operators and plan managers shall apply solely to transient accommodations in the State arranged or booked directly through the registered transient accommodations broker tax collection agent.

(c) The registered transient accommodations broker tax collection agent's operators and plan managers shall obtain licensure under this chapter; provided that the registered transient accommodations broker tax collection agent may comply with all requirements of title 14 on behalf of the operators and plan managers for business activity conducted directly through the agent, from the date of registration until the registration is canceled as provided in subsection (h). For purposes of any other business activity, the operators and plan managers are subject to all requirements of title 14 as if this section did not exist.

(d) Under this section, a registered transient accommodations broker tax collection agent shall assume all obligations, rights, and responsibilities imposed by this chapter upon its operators and plan managers with respect to their business activities conducted directly through the registered transient accommodations broker tax collection agent from the date of registration until the registration is canceled as provided in subsection (h).

(e) A transient accommodations broker tax collection agent shall be personally liable for the taxes imposed by this chapter that are due and collected on behalf of operators and plan managers, if taxes are collected, but not reported or paid, together with penalties and interest as provided by law.

(f) All returns and other information provided by a registered transient accommodations broker tax collection agent, including the application for registration as a transient accommodations broker tax collection agent or any tax collection agreement, shall be confidential and disclosure thereof shall be prohibited as provided in section 237-34; provided that no disclosure of returns or information provided by the transient accommodations broker tax collection agent with respect to its operators and plan managers shall be made pursuant to section 237-34(b)(9), (10) or (11).

(g) A registered transient accommodations broker tax collection agent shall not be required to disclose to the director the names or addresses of any of its operators and plan managers in connection with any return, reconciliation, payment, or other filing by the registered transient accommodations broker tax collection agent under this chapter; provided that the name and address of an operator or plan manager shall be disclosed in response to a lawful and valid subpoena or upon waiver by the operator or plan manager.

(h) The registration provided for under this section shall be effective until canceled in writing.

A registered transient accommodations broker tax collection agent may cancel its registration under this section by delivering written notice of cancellation to the director and each of its operators and plan managers furnishing transient accommodations in the State not later than ninety days prior to the effective date of cancellation.

The director may cancel a transient accommodations broker tax collection agent's registration under this section for any cause, including but not limited to any violation of this chapter or rules adopted pursuant thereto, or for violation of any applicable tax collection agreement, by delivering written notice of cancellation to the transient accommodations broker tax collection agent not later than ninety days prior to the effective date of cancellation.

(i) For the purposes of this section:

"Operator" has the same meaning as in section 237D-1.

"Plan manager" has the same meaning as in section 237D-1.

"Transient accommodations broker" has the same meaning as in section 237D-1.

(j) All registered transient accommodations broker tax collection agents shall inquire and ensure that the transient accommodation is in compliance with all pertinent state and county land use laws, including but not limited to:

(1) Prior to placing an advertisement, including an online advertisement, on the availability of a property for lease or rent on behalf of an operator or plan manager, notifying the operator or plan manager that the subject property is required to be in compliance with applicable state and county land use laws prior to retaining the services of the transient accommodations broker; and

(2) Requiring the operator or plan manager to provide verification of compliance with county land use laws in the form of a written certification, verification, or permit issued by the appropriate county agency."

SECTION 3. Chapter 237D, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"237D-   Transient accommodations broker as tax collection agent. (a) The director may permit a transient accommodations broker to register as a tax collection agent on behalf of all of its operators and plan managers by entering into a tax collection agreement with the director or by submitting a transient accommodations broker tax collection agent registration statement to the director.

The director may deny an application for registration as a transient accommodations broker tax collection agent under this section for any cause authorized by law, including but not limited to any violation of this chapter or rules adopted pursuant thereto, violation of any prior tax collection agreement, or failure to meet minimum criteria that may be set forth by the department in rules adopted pursuant to chapter 91.

Execution of a tax collection agreement shall not be a requirement for registration as a transient accommodations broker tax collection agent.

The director shall issue a certificate of registration or letter of denial within thirty days after a transient accommodations broker submits to the director a completed and signed transient accommodations broker tax collection agent registration statement, in a form prescribed by the department. The registration shall be valid only for the transient accommodations broker tax collection agent in whose name it is issued, and for the website or platform designated therein, and shall not be transferable.

A registered transient accommodations broker tax collection agent shall be issued separate certificates of registration under this chapter with respect to taxes payable on behalf of its operators and plan managers in its capacity as a registered transient accommodations broker tax collection agent and, if applicable, with respect to any taxes payable under this chapter for its own business activities.

(b) In addition to its own responsibilities under this chapter, a registered transient accommodations broker tax collection agent shall report, collect, and pay over the taxes due under this chapter on behalf of all of its operators and plan managers from the date of registration until the registration is canceled as provided in subsection (h); provided that the registered transient accommodations broker tax collection agent's obligation to report, collect, and pay taxes on behalf of all of its operators and plan managers shall apply solely to transient accommodations in the State arranged or booked directly through the registered transient accommodations broker tax collection agent.

(c) The registered transient accommodations broker tax collection agent's operators and plan managers shall obtain registration under this chapter; provided that the registered transient accommodations broker tax collection agent may comply with all requirements of title 14 on behalf of the operators and plan managers for business activity conducted directly through the agent, from the date of registration until the registration is canceled as provided in subsection (h). For purposes of any other business activity, the operators and plan managers are subject to all requirements of title 14 as if this section did not exist.

(d) Under this section, a registered transient accommodations broker tax collection agent shall assume all obligations, rights, and responsibilities imposed by this chapter upon its operators and plan managers with respect to their business activities conducted directly through the registered transient accommodations broker tax collection agent from the date of registration until the registration is canceled as provided in subsection (h).

(e) A transient accommodations broker tax collection agent shall be personally liable for the taxes imposed by this chapter that are due and collected on behalf of operators and plan managers, if taxes are collected, but not reported or paid, together with penalties and interest as provided by law.

(f) All returns and other information provided by a registered transient accommodations broker tax collection agent, including the application for registration as a transient accommodations broker tax collection agent or any tax collection agreement, shall be confidential and disclosure thereof shall be prohibited as provided in section 237D-13; provided that no disclosure of returns or information provided by the transient accommodations broker tax collection agent with respect to its operators and plan managers shall be made pursuant to section 237D-13(a)(9), (10) or (11).

(g) A registered transient accommodations broker tax collection agent shall not be required to disclose to the director the names or addresses of any of its operators and plan managers in connection with any return, reconciliation, payment, or other filing by the registered transient accommodations broker tax collection agent under this chapter; provided that the name and address of an operator or plan manager shall be disclosed in response to a lawful and valid subpoena or upon waiver by the operator or plan manager.

(h) The registration provided for under this section shall be effective until canceled in writing.

A registered transient accommodations broker tax collection agent may cancel its registration under this section by delivering written notice of cancellation to the director and each of its operators and plan managers furnishing transient accommodations in the State not later than ninety days prior to the effective date of cancellation.

The director may cancel a transient accommodations broker tax collection agent's registration under this section for any cause, including but not limited to any violation of this chapter or rules adopted pursuant thereto, or for violation of any applicable tax collection agreement, by delivering written notice of cancellation to the transient accommodations broker tax collection agent not later than ninety days prior to the effective date of cancellation.

(i) All registered transient accommodations broker tax collection agents shall inquire and ensure that the transient accommodation is in compliance with all pertinent state and county land use laws, including but not limited to:

(1) Prior to placing an advertisement, including an online advertisement, on the availability of a property for lease or rent on behalf of an operator or plan manager, notifying the operator or plan manager that the subject property is required to be in compliance with applicable state and county land use laws prior to retaining the services of the transient accommodations broker; and

(2) Requiring the operator or plan manager to provide verification of compliance with county land use laws in the form of a written certification, verification, or permit issued by the appropriate county agency."

SECTION 4. By January 1, 2017, the director of taxation shall make available to transient accommodations brokers a form of application for registration as a transient accommodations broker tax collection agent under the new section of chapter 237, Hawaii Revised Statutes, added by section 2 of this Act, and under the new section of chapter 237D, Hawaii Revised Statutes, added by section 3 of this Act.

SECTION 5. If any provision of this Act, or the application thereof to any person or circumstance, is held invalid, the invalidity does not affect other provisions or applications of the Act that can be given effect without the invalid provision or application, and to this end the provisions of this Act are severable.

SECTION 6. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 7. This Act, upon its approval, shall apply to taxable years beginning after December 31, 2016.



Report Title:

Taxation; Transient Accommodations Brokers; Tax Collection Agents; General Excise Tax; Transient Accommodations Tax

 

Description:

Allows transient accommodations brokers to register as a tax collection agent on behalf of all of its operators and plan managers. Requires registered transient accommodations broker tax collection agent's operators and plan managers to obtain licensure as a tax collection agent. Requires all registered transient accommodations broker tax collection agents to inquire and ensure that the transient accommodation is in compliance with all pertinent state and county land use laws. Requires the operator or plan manager to provide verification of compliance with county land use laws in the form of a written certification, verification, or permit issued by the appropriate county agency. (SD3)

 

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.