STAND. COM. REP. NO. 189
RE: S.B. No. 1201
Honorable Ronald D. Kouchi
President of the Senate
Thirty-First State Legislature
Regular Session of 2021
State of Hawaii
Your Committee on Commerce and Consumer Protection, to which was referred S.B. No. 1201 entitled:
"A BILL FOR AN ACT RELATING TO GENERAL EXCISE TAX LICENSES,"
begs leave to report as follows:
The purpose and intent of this measure is to:
(1) Require that any license issued under section 237-9, Hawaii Revised Statutes, be renewed biennially;
(2) Permit the Department of Taxation to charge a fee for biennial renewals; and
(3) Permit the Department of Taxation to require biennial renewals be applied for electronically.
Your Committee received testimony in support of this measure from the Department of Taxation. Your Committee received comments on this measure from the Tax Foundation of Hawaii.
Your Committee finds that many general excise tax license holders who close their businesses fail to cancel their licenses, which leads to the Department of Taxation's records being filled with defunct licenses. According to the Department of Taxation's testimony, the Department has found that many taxpayers fail to update their business registration and contact information when there are changes, leading to a waste of State resources when Department mailings get returned and Department personnel have to manually search for the taxpayer's new address. This measure requires general excise tax license holders to renew their licenses biennially, and allows for electronic filing, which will help facilitate efficient tax administration.
Your Committee has amended this measure by:
(1) Clarifying that existing general excise tax licenses issued and in effect on or before the effective date of this measure shall be subject to renewal beginning in 2022, provided that the Department of Taxation shall not immediately charge a fee for the renewal; and
(2) 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 Commerce and Consumer Protection that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 1201, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 1201, S.D. 1, and be referred to your Committee on Ways and Means.
Respectfully submitted on behalf of the members of the Committee on Commerce and Consumer Protection,
ROSALYN H. BAKER, Chair