STAND.
COM. REP. NO. 625-20
Honolulu, Hawaii
, 2020
RE: H.B. No. 2726
H.D. 1
Honorable Scott K. Saiki
Speaker, House of Representatives
Thirtieth State Legislature
Regular Session of 2020
State of Hawaii
Sir:
Your Committee on Consumer Protection & Commerce, to which was referred H.B. No. 2726, H.D. 1, entitled:
"A BILL FOR AN ACT RELATING TO INTOXICATING LIQUOR,"
begs leave to report as follows:
The
purpose of this measure is to:
(1) Amend the definition of "cooler beverage" to include spirits-based beverages, to encourage local distilleries to produce ready-to-drink cocktails; and
(2) Create a more equitable taxation scheme by establishing a separate tax rate on beer for small craft producer pubs.
Your Committee finds that under the existing definition of "cooler beverage", the relevant tax rate is only applicable to wine-based or beer-based beverages, while beverages that are spirits-based are taxed as distilled spirits. This measure addresses the disparate tax treatment and will encourage local distilleries to produce ready-to-drink cocktails.
Your Committee further finds that the existing tax scheme on
beer is punitive and burdensome for small brewers and hinders their
sustainability and growth. Small brewers
operate on a much different economic scale than larger brewing companies, and
tax rates should take these differences into account. This measure will create a more equitable tax
burden across brewers of different sizes.
Your Committee notes that the Department of the Attorney General raised concerns that this measure could be challenged under the Commerce Clause of the United States Constitution. Should your Committee on Finance consider this measure, your Committee requests that it give consideration to these concerns.
As affirmed by the record of votes of the members of your Committee on Consumer Protection & Commerce that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 2726, H.D. 1, and recommends that it be referred to your Committee on Finance.
Respectfully submitted on behalf of the members of the Committee on Consumer Protection & Commerce,
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____________________________ ROY M. TAKUMI, Chair |
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