HOUSE OF REPRESENTATIVES

H.B. NO.

2614

TWENTY-SEVENTH LEGISLATURE, 2014

H.D. 1

STATE OF HAWAII

 

 

 

 

 

 

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 Hawaii's unique mid-Pacific, near-equatorial location, diverse technological assets, resident technological expertise, and strategic ties with space-faring nations from around the Asia-Pacific region uniquely qualify our state to serve as a premier, cost-effective, and globally competitive site for launching next-generation commercial spacecraft that will carry satellites, experimental payloads, and people into space.

The legislature also finds that space launch operations would enable Hawaii to become a major international player in aerospace research and development -- advancing applications in diverse areas such as microgravity research, disaster monitoring and mitigation, space-based telecommunications, meteorological forecasting, space-based solar power, and other areas that would rapidly expand and diversify Hawaii's aerospace sector as a strategic growth industry for the State.

The legislature further finds that developing these capabilities would not only afford pioneering research and development opportunities for Hawaii's university and commercial sectors, but would also enable the launch of next-generation "spaceplanes" to carry both experiments and passengers to the edge of the Earth's atmosphere and bring space tourism to Hawaii.

The purpose of this Act is to promote the development of spacecraft launching capability in Hawaii by providing general excise and use tax exemptions for amounts received from the construction of a space launch facility in the State.

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

"237- Space launch facility. (a) This chapter shall not apply to amounts received from the construction of a space launch facility in the State.

(b) As used in this section:

"Construction of a space launch facility" means all design, engineering, labor, and material costs associated with the construction, reconstruction, or improvement of new or existing space launch facilities.

"Space flight" means any flight designed for suborbital, orbital, or interplanetary travel by a space vehicle, satellite, space facility, or space station of any kind.

"Space launch facility" means a facility designed to facilitate space flight. This includes commercial space launch sites and facilities the principal purpose of which is to manufacture, fabricate, assemble, or process equipment that facilitates the renovation, rehabilitation, or reconstruction of commercial space launch sites."

SECTION 3. Section 238-1, Hawaii Revised Statutes, is amended by amending the definition of "use" to read as follows:

""Use" (and any nounal, verbal, adjectival, adverbial, and other equivalent form of the term) herein used interchangeably means any use, whether the use is of such nature as to cause the property, services, or contracting to be appreciably consumed or not, or the keeping of the property or services for such use or for sale, the exercise of any right or power over tangible or intangible personal property incident to the ownership of that property, and shall include control over tangible or intangible property by a seller who is licensed or who should be licensed under chapter 237, who directs the importation of the property into the State for sale and delivery to a purchaser in the State, liability and free on board (FOB) to the contrary notwithstanding, regardless of where title passes, but the term "use" shall not include:

(1) Temporary use of property, not of a perishable or quickly consumable nature, where the property is imported into the State for temporary use (not sale) therein by the person importing the same and is not intended to be, and is not, kept permanently in the State. For example, without limiting the generality of the foregoing language:

(A) In the case of a contractor importing permanent equipment for the performance of a construction contract, with intent to remove, and who does remove, the equipment out of the State upon completing the contract;

(B) In the case of moving picture films imported for use in theaters in the State with intent or under contract to transport the same out of the State after completion of such use; and

(C) In the case of a transient visitor importing an automobile or other belongings into the State to be used by the transient visitor while therein but which are to be used and are removed upon the transient visitor's departure from the State;

(2) Use by the taxpayer of property acquired by the taxpayer solely by way of gift;

(3) Use which is limited to the receipt of articles and the return thereof, to the person from whom acquired, immediately or within a reasonable time either after temporary trial or without trial;

(4) Use of goods imported into the State by the owner of a vessel or vessels engaged in interstate or foreign commerce and held for and used only as ship stores for the vessels;

(5) The use or keeping for use of household goods, personal effects, and private automobiles imported into the State for nonbusiness use by a person who:

(A) Acquired them in another state, territory, district, or country;

(B) At the time of the acquisition was a bona fide resident of another state, territory, district, or country;

(C) Acquired the property for use outside the State; and

(D) Made actual and substantial use thereof outside this State;

provided that as to an article acquired less than three months prior to the time of its importation into the State it shall be presumed, until and unless clearly proved to the contrary, that it was acquired for use in the State and that its use outside the State was not actual and substantial;

(6) The leasing or renting of any aircraft or the keeping of any aircraft solely for leasing or renting to lessees or renters using the aircraft for commercial transportation of passengers and goods or the acquisition or importation of any such aircraft or aircraft engines by any lessee or renter engaged in interstate air transportation. For purposes of this paragraph, "leasing" includes all forms of lease, regardless of whether the lease is an operating lease or financing lease. The definition of "interstate air transportation" is the same as in 49 U.S.C. 40102;

(7) The use of oceangoing vehicles for passenger or passenger and goods transportation from one point to another within the State as a public utility as defined in chapter 269;

(8) The use of material, parts, or tools imported or purchased by a person licensed under chapter 237 which are used for aircraft service and maintenance, or the construction of an aircraft service and maintenance facility as those terms are defined in section 237-24.9;

(9) The use of services or contracting imported for resale where the contracting or services are for resale, consumption, or use outside the State pursuant to section 237-29.53(a); [and]

(10) The use of property, services, or contracting imported by foreign diplomats and consular officials who are holding cards issued or authorized by the United States Department of State granting them an exemption from state taxes[.]; and

(11) The use of material, parts, or tools imported or purchased by a person licensed under chapter 237 that are used for the construction of a space launch facility as those terms are defined in section 237‑   .

With regard to purchases made and distributed under the authority of chapter 421, a cooperative association shall be deemed the user thereof."

SECTION 4. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 5. This Act shall take effect on January 20, 2050.


 


 

Report Title:

Aerospace; Space Launch Facility; General Excise Tax

 

Description:

Exempts from the general excise tax and use tax, amounts received from the construction of a space launch facility in the State. Effective January 20, 2050. (HB2614 HD1)

 

 

 

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