Bill Text: HI HB959 | 2025 | Regular Session | Introduced
Bill Title: Relating To Taxation.
Spectrum: Partisan Bill (Democrat 5-0)
Status: (Introduced) 2025-01-23 - Referred to ECD, FIN, referral sheet 3 [HB959 Detail]
Download: Hawaii-2025-HB959-Introduced.html
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HOUSE OF REPRESENTATIVES |
H.B. NO. |
959 |
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THIRTY-THIRD LEGISLATURE, 2025 |
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STATE OF HAWAII |
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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 tax equity is a cornerstone of economic prosperity. According to the Institute on Taxation and Economic Policy, Hawaii places the second-highest tax burden on low-income households, with the State's lowest-income households paying approximately fifteen per cent of their income in state and local taxes. In comparison, the State's highest earning households pay approximately nine per cent of their income in state and local taxes.
The legislature further finds that the State's cost of living continues to be burdensome for residents. According to the National Low Income Housing Coalition's "Out of Reach 2023" report, a minimum wage employee must work one hundred seven hours per week to afford a one-bedroom rental home at fair market prices. To afford a two-bedroom residence without being cost burdened, the National Low Income Housing Coalition estimates that a person must earn $41.83 per hour.
In addition to the rising cost of housing, the costs of utilities, groceries, and other everyday items have also increased significantly within the last five years. Rising costs of these essential items can also increase the burden on lower-income families. Eliminating the general excise tax on groceries and nonprescription drugs, for example, could ease the tax burden on residents, especially lower-income households. Further, money saved from a lower tax burden can be spent elsewhere in the local economy, creating a circular effect that will help many individuals and families statewide.
The legislature additionally finds that on August 8, 2023, wildfires swept across Maui and killed at least one hundred two people, making it one of the deadliest natural disasters in United States history. The 2023 Maui wildfires destroyed over two thousand two hundred structures, including homes and businesses. Rebuilding after the devastating impacts of the wildfires on the island of Maui could cost more than $5 billion, according to a preliminary assessment prepared by the university of Hawaii pacific disaster center and local officials.
Accordingly, the purpose of this Act is to:
(1) Exempt the sale of groceries and nonprescription drugs from the general excise tax;
(2) Incrementally increase the general excise tax over four years to six per cent, with the increased proceeds during certain fiscal years to be deposited into the general fund;
(3) Remove the state income tax on unemployment compensation benefits;
(4) Double the standard deduction for individuals earning less than $100,000 and joint returns earning less than $200,000;
(5) Repeal the incremental increases on standard
income tax deduction amounts;
(6) Increase the minimum income threshold exemption amount for the low-income household renters' income tax credit;
(7) Remove the tax liability for the first $100,000 of individual income earned; and
(8) Establish a Maui recovery special fund for the impacts related to the 2023 Maui wildfires.
PART II
SECTION 2. Chapter 237, Hawaii Revised Statutes, is amended by adding two new sections to be appropriately designated and to read as follows:
"§237- Exemption for groceries. There shall be exempted from, and
excluded from the measure of, the taxes imposed by this chapter all of the
gross proceeds or gross income received or derived from the sale of groceries.
For
purposes of this section, "groceries" means products eligible to be
purchased with the United States Department of Agriculture's Supplemental
Nutrition Assistance Program benefits.
§237- Exemption for nonprescription drugs. (a)
There shall be exempted from, and excluded from the measure of, the
taxes imposed by this chapter all of the gross proceeds or gross income
received or derived from the sale of nonprescription drugs.
(b) For the purposes of this section:
"Drug"
means:
(1) Articles recognized in the official
United States Pharmacopoeia, official United States Pharmacopoeia Dispensing
Information, official Homeopathic Pharmacopoeia of the United States, or
official National Formulary, or any supplement to any of these publications;
(2) Articles intended for use in the
diagnosis, cure, mitigation, treatment, or prevention of disease in humans or
animals;
(3) Articles, other than food or
clothing, intended to affect the structure or any function of the body of
humans or animals; or
(4) Articles intended for use as a
component of any article specified in paragraphs (1) through (3); provided that
the term "drug" does not include devices or their components, parts
or accessories, cosmetics, or liquor as defined in section 281-1.
"Nonprescription drug" means any packaged, bottled, or nonbulk chemical, drug, or medicine that may be lawfully sold without a practitioner's order."
PART III
SECTION 3. Section 237-13, Hawaii Revised Statutes, is amended to read as follows:
"§237-13 Imposition of tax. There is hereby levied and shall be assessed
and collected annually privilege taxes against persons on account of their
business and other activities in the State measured by the application of rates
against values of products, gross proceeds of sales, or gross income, whichever
is specified, as follows:
(1) Tax on manufacturers.
(A) Upon every person engaging or continuing within the State in the business of manufacturing, including compounding, canning, preserving, packing, printing, publishing, milling, processing, refining, or preparing for sale, profit, or commercial use, either directly or through the activity of others, in whole or in part, any article or articles, substance or substances, commodity or commodities, the amount of the tax to be equal to the value of the articles, substances, or commodities, manufactured, compounded, canned, preserved, packed, printed, milled, processed, refined, or prepared for sale, as shown by the gross proceeds derived from the sale thereof by the manufacturer or person compounding, preparing, or printing them, multiplied by one-half of one per cent.
(B) The
measure of the tax on manufacturers is the value of the entire product for
sale.
(2) Tax on business of selling tangible personal property; producing.
(A) Upon
every person engaging or continuing in the business of selling any tangible
personal property whatsoever, there is likewise hereby levied, and shall be
assessed and collected, a tax equivalent to [four]:
(i)
per cent for taxable years beginning after December 31, 2025;
(ii) per
cent for taxable years beginning after December 31, 2026;
(iii) per
cent for taxable years beginning after December 31, 2027; and
(iv) per
cent for taxable years beginning after December 31, 2028,
of the gross proceeds of sales of
the business; provided that, in the case of a wholesaler, the tax shall be
equal to one-half of one per cent of the gross proceeds of sales of the
business; [and] provided further that insofar as the sale of tangible
personal property is a wholesale sale under section 237-4(a)(8), the tax shall
be one-half of one per cent of the gross proceeds. Upon every person engaging or continuing
within this State in the business of a producer, the tax shall be equal to
one-half of one per cent of the gross proceeds of sales of the business, or the
value of the products, for sale.
(B) Gross proceeds of sales of tangible
property in interstate and foreign commerce shall constitute a part of the
measure of the tax imposed on persons in the business of selling tangible
personal property, to the extent, under the conditions, and in accordance with
the provisions of the Constitution of the United States and the Acts of the
Congress of the United States [which] that may be now in force or
may be hereafter adopted, and whenever there occurs in the State an activity to
which, under the Constitution and Acts of Congress, there may be attributed
gross proceeds of sales, the gross proceeds shall be so attributed.
(C) No
manufacturer or producer, engaged in [such] business in the State and
selling the manufacturer's or producer's products for delivery outside of the
State (for example, consigned to a mainland purchaser via common carrier f.o.b.
Honolulu), shall be required to pay the tax imposed in this chapter for the
privilege of so selling the products, and the value or gross proceeds of sales
of the products shall be included only in determining the measure of the tax
imposed upon the manufacturer or producer.
(D) A
manufacturer or producer, engaged in [such] business in the State, shall
pay the tax imposed in this chapter for the privilege of selling its products
in the State, and the value or gross proceeds of sales of the products, thus
subjected to tax, may be deducted insofar as duplicated as to the same products
by the measure of the tax upon the manufacturer or producer for the privilege
of manufacturing or producing in the State; provided that no producer of
agricultural products who sells the products to a purchaser who will process
the products outside the State shall be required to pay the tax imposed in this
chapter for the privilege of producing or selling those products.
(E) A
taxpayer selling to a federal cost-plus contractor may make the election
provided for by paragraph (3)(C), and in that case the tax shall be computed
pursuant to the election, notwithstanding this paragraph or paragraph (1) to
the contrary.
(F) The
department, by rule, may require that a seller take from the purchaser of
tangible personal property a certificate, in a form prescribed by the
department, certifying that the sale is a sale at wholesale; provided that:
(i) Any purchaser who furnishes a certificate shall be obligated to pay to the seller, upon demand, the amount of the additional tax that is imposed upon the seller whenever the sale in fact is not at wholesale; and
(ii) The absence of a certificate in itself shall give rise to the presumption that the sale is not at wholesale unless the sales of the business are exclusively at wholesale.
(3) Tax upon contractors.
(A) Upon every person engaging or
continuing within the State in the business of contracting, the tax shall be
equal to [four]:
(i)
per cent for taxable years beginning after December 31, 2025;
(ii) per
cent for taxable years beginning after December 31, 2026;
(iii) per
cent for taxable years beginning after December 31, 2027; and
(iv) per
cent for taxable years beginning after December 31, 2028,
of
the gross income of the business.
(B) In computing the tax levied under this paragraph, there shall be deducted from the gross income of the taxpayer so much thereof as has been included in the measure of the tax levied under subparagraph (A), on another taxpayer who is a contractor, as defined in section 237-6; provided that any person claiming a deduction under this paragraph shall be required to show in the person's return the name and general excise number of the person paying the tax on the amount deducted by the person.
(C) In computing the tax levied under this paragraph against any federal cost-plus contractor, there shall be excluded from the gross income of the contractor so much thereof as fulfills the following requirements:
(i) The gross income exempted shall constitute reimbursement of costs incurred for materials, plant, or equipment purchased from a taxpayer licensed under this chapter, not exceeding the gross proceeds of sale of the taxpayer on account of the transaction; and
(ii) The taxpayer making the sale shall have certified to the department that the taxpayer is taxable with respect to the gross proceeds of the sale, and that the taxpayer elects to have the tax on gross income computed the same as upon a sale to the state government.
(D) A person who, as a business or as a part of a business in which the person is engaged, erects, constructs, or improves any building or structure, of any kind or description, or makes, constructs, or improves any road, street, sidewalk, sewer, or water system, or other improvements on land held by the person (whether held as a leasehold, fee simple, or otherwise), upon the sale or other disposition of the land or improvements, even if the work was not done pursuant to a contract, shall be liable to the same tax as if engaged in the business of contracting, unless the person shows that at the time the person was engaged in making the improvements the person intended, and for the period of at least one year after completion of the building, structure, or other improvements the person continued to intend to hold and not sell or otherwise dispose of the land or improvements. The tax in respect of the improvements shall be measured by the amount of the proceeds of the sale or other disposition that is attributable to the erection, construction, or improvement of such building or structure, or the making, constructing, or improving of the road, street, sidewalk, sewer, or water system, or other improvements. The measure of tax in respect of the improvements shall not exceed the amount which would have been taxable had the work been performed by another, subject as in other cases to the deductions allowed by subparagraph (B). Upon the election of the taxpayer, this paragraph may be applied notwithstanding that the improvements were not made by the taxpayer, or were not made as a business or as a part of a business, or were made with the intention of holding the same. However, this paragraph shall not apply in respect of any proceeds that constitute or are in the nature of rent, which shall be taxable under paragraph (9); provided that insofar as the business of renting or leasing real property under a lease is taxed under section 237-16.5, the tax shall be levied by section 237-16.5.
(4) Tax upon theaters, amusements, radio broadcasting stations, etc.
(A) Upon every person engaging or
continuing within the State in the business of operating a theater, opera
house, moving picture show, vaudeville, amusement park, dance hall, skating
rink, radio broadcasting station, or any other place at which amusements are
offered to the public, the tax shall be equal to [four]:
(i)
per cent for taxable years beginning after December 31, 2025;
(ii) per
cent for taxable years beginning after December 31, 2026;
(iii) per
cent for taxable years beginning after December 31, 2027; and
(iv) per
cent for taxable years beginning after December 31, 2028,
of the gross income of the business, and in the case of a sale of an amusement at wholesale under section 237-4(a)(13), the tax shall be one-half of one per cent of the gross income.
(B) The department may require that the person rendering an amusement at wholesale take from the licensed seller a certificate, in a form prescribed by the department, certifying that the sale is a sale at wholesale; provided that:
(i) Any licensed seller who furnishes a certificate shall be obligated to pay to the person rendering the amusement, upon demand, the amount of additional tax that is imposed upon the seller whenever the sale is not at wholesale; and
(ii) The absence of a certificate in itself shall give rise to the presumption that the sale is not at wholesale unless the person rendering the sale is exclusively rendering the amusement at wholesale.
(5) Tax
upon sales representatives, etc. Upon
every person classified as a representative or purchasing agent under section
237-1, engaging or continuing within the State in the business of performing
services for another, other than as an employee, there is likewise hereby
levied and shall be assessed and collected a tax equal to [four]:
(i)
per cent for taxable years beginning after December 31, 2025;
(ii) per
cent for taxable years beginning after December 31, 2026;
(iii) per
cent for taxable years beginning after December 31, 2027; and
(iv) per
cent for taxable years beginning after December 31, 2028,
of the commissions and other compensation attributable to the services so rendered by the person.
(6) Tax on service business.
(A) Upon every person engaging or
continuing within the State in any service business or calling including
professional services not otherwise specifically taxed under this chapter,
there is likewise hereby levied and shall be assessed and collected a tax equal
to [four]:
(i)
per cent for taxable years beginning after December 31, 2025;
(ii) per
cent for taxable years beginning after December 31, 2026;
(iii) per
cent for taxable years beginning after December 31, 2027; and
(iv) per
cent for taxable years beginning after December 31, 2028,
of the gross income of the business, and in the case of a wholesaler under section 237-4(a)(10), the tax shall be equal to one-half of one per cent of the gross income of the business.
(B) The department may require that the person rendering a service at wholesale take from the licensed seller a certificate, in a form prescribed by the department, certifying that the sale is a sale at wholesale; provided that:
(i) Any licensed seller who furnishes a certificate shall be obligated to pay to the person rendering the service, upon demand, the amount of additional tax that is imposed upon the seller whenever the sale is not at wholesale; and
(ii) The absence of a certificate in itself shall give rise to the presumption that the sale is not at wholesale unless the person rendering the sale is exclusively rendering services at wholesale.
(C) Where any person is engaged in the business of selling interstate or foreign common carrier telecommunication services within and without the State, other than as a home service provider, the tax shall be imposed on that portion of gross income received by a person from service which is originated or terminated in this State and is charged to a telephone number, customer, or account in this State notwithstanding any other state law (except for the exemption under section 237-23(a)(1)) to the contrary. If, under the Constitution and laws of the United States, the entire gross income as determined under this paragraph of a business selling interstate or foreign common carrier telecommunication services cannot be included in the measure of the tax, the gross income shall be apportioned as provided in section 237-21; provided that the apportionment factor and formula shall be the same for all persons providing those services in the State.
(D) Where any person is engaged in the business of a home service provider, the tax shall be imposed on the gross income received or derived from providing interstate or foreign mobile telecommunications services to a customer with a place of primary use in this State when the services originate in one state and terminate in another state, territory, or foreign country; provided that all charges for mobile telecommunications services which are billed by or for the home service provider are deemed to be provided by the home service provider at the customer's place of primary use, regardless of where the mobile telecommunications originate, terminate, or pass through; provided further that the income from charges specifically derived from interstate or foreign mobile telecommunications services, as determined by books and records that are kept in the regular course of business by the home service provider in accordance with section 239-24, shall be apportioned under any apportionment factor or formula adopted under subparagraph (C). Gross income shall not include:
(i) Gross receipts from mobile telecommunications services provided to a customer with a place of primary use outside this State;
(ii) Gross receipts from mobile telecommunications services that are subject to the tax imposed by chapter 239;
(iii) Gross receipts from mobile telecommunications services taxed under section 237-13.8; and
(iv) Gross receipts of a home service provider acting as a serving carrier providing mobile telecommunications services to another home service provider's customer.
For
the purposes of this paragraph, "charges for mobile telecommunications
services", "customer", "home service provider", "mobile
telecommunications services", "place of primary use", and "serving
carrier" have the same [meaning] meanings as defined
in section 239-22.
(7) Tax on insurance producers. Upon every person engaged as a licensed producer pursuant to chapter 431, there is hereby levied and shall be assessed and collected a tax equal to 0.15 per cent of the commissions due to that activity.
(8) Tax on receipts of sugar benefit payments. Upon the amounts received from the United States government by any producer of sugar (or the producer's legal representative or heirs), as defined under and by virtue of the Sugar Act of 1948, as amended, or other Acts of the Congress of the United States relating thereto, there is hereby levied a tax of one-half of one per cent of the gross amount received; provided that the tax levied hereunder on any amount so received and actually disbursed to another by a producer in the form of a benefit payment shall be paid by the person or persons to whom the amount is actually disbursed, and the producer actually making a benefit payment to another shall be entitled to claim on the producer's return a deduction from the gross amount taxable hereunder in the sum of the amount so disbursed. The amounts taxed under this paragraph shall not be taxable under any other paragraph, subsection, or section of this chapter.
(9) Tax
on other business. Upon every person
engaging or continuing within the State in any business, trade, activity,
occupation, or calling not included in the preceding paragraphs or any other
provisions of this chapter, there is likewise hereby levied and shall be
assessed and collected, a tax equal to [four]:
(A)
per cent for taxable years beginning after December 31, 2025;
(B) per
cent for taxable years beginning after December 31, 2026;
(C) per
cent for taxable years beginning after December 31, 2027; and
(D) per
cent for taxable years beginning after December 31, 2028,
of the gross income thereof. In addition, the rate prescribed by this paragraph shall apply to a business taxable under one or more of the preceding paragraphs or other provisions of this chapter, as to any gross income thereof not taxed thereunder as gross income or gross proceeds of sales or by taxing an equivalent value of products, unless specifically exempted."
SECTION 4. Section 237-15, Hawaii Revised Statutes, is amended to read as follows:
"§237-15
Technicians. When technicians
supply dentists or physicians with dentures, orthodontic devices, braces, and
similar items [which] that have been prepared by the technician
in accordance with specifications furnished by the dentist or physician, and
such items are to be used by the dentist or physician in the dentist's or
physician's professional practice for a particular patient who is to pay the
dentist or physician for the same as a part of the dentist's or physician's
professional services, the technician shall be taxed as though the technician
were a manufacturer selling a product to a licensed retailer, rather than at
the rate [of four per cent which] that is generally
applied to professions and services."
SECTION 5. Section 237-16.5, Hawaii Revised Statutes, is amended as follows:
1. By amending subsection (a) to read:
"(a) This section relates to the leasing of real
property by a lessor to a lessee. There
is hereby levied, and shall be assessed and collected annually, a privilege tax
against persons engaging or continuing within the State in the business of
leasing real property to another, equal to [four]:
(1)
per cent for taxable years beginning after December 31, 2025;
(2) per
cent for taxable years beginning after December 31, 2026;
(3) per
cent for taxable years beginning after December 31, 2027; and
(4) per
cent for taxable years beginning after December 31, 2028,
of the gross proceeds or gross
income received or derived from the leasing; provided that where real property
is subleased by a lessee to a sublessee, the lessee, as provided in this
section, shall be allowed a deduction from the amount of gross proceeds or
gross income received from its sublease of the real property. The deduction shall be in the amount allowed
under this section.
All
deductions under this section and the name and general excise tax number of the
lessee's lessor shall be reported on the general excise tax return. Any deduction allowed under this section
shall only be allowed with respect to leases and subleases in writing and
relating to the same real property."
2. By amending subsection (f) to read:
"(f) This section shall not cause the tax upon a
lessor, with respect to any item of the lessor's gross proceeds or gross
income, to exceed [four]:
(1)
per cent for taxable years beginning after December 31, 2025;
(2) per
cent for taxable years beginning after December 31, 2026;
(3) per
cent for taxable years beginning after December 31, 2027; and
(4) per
cent for taxable years beginning after December 31, 2028."
SECTION 6. Section 237-18, Hawaii Revised Statutes, is amended by amending subsection (f) to read as follows:
"(f) Where tourism related services are furnished through arrangements made by a travel agency or tour packager and the gross income is divided between the provider of the services and the travel agency or tour packager, the tax imposed by this chapter shall apply to each such person with respect to such person's respective portion of the proceeds, and no more.
As
used in this subsection "tourism related services" means catamaran
cruises, canoe rides, dinner cruises, lei greetings, transportation included in
a tour package, sightseeing tours not subject to chapter 239, admissions to
luaus, dinner shows, extravaganzas, cultural and educational facilities, and
other services rendered directly to the customer or tourist, but only if the
providers of the services other than air transportation are subject to a [four
per cent] tax rate of:
(1)
per cent for taxable years beginning after December 31, 2025;
(2) per
cent for taxable years beginning after December 31, 2026;
(3) per
cent for taxable years beginning after December 31, 2027; and
(4) per
cent for taxable years beginning after December 31, 2028,
under this chapter or chapter 239."
SECTION 7. Section 237-31, Hawaii Revised Statutes, is amended to read as follows:
"§237-31 Remittances. (a)
All remittances of taxes imposed by this chapter shall be made by money,
bank draft, check, cashier's check, money order, or certificate of deposit to the
office of the department of taxation to which the return was transmitted.
(b) The department shall issue its receipts therefor
to the taxpayer and shall pay the moneys into the state treasury as a state realization,
to be kept and accounted for as provided by law; provided that:
(1) A sum, not to exceed $5,000,000, from all general excise tax revenues realized by the State shall be deposited in the state treasury in each fiscal year to the credit of the compound interest bond reserve fund;
(2) A sum from all general excise tax revenues realized by the State that is equal to one-half of the total amount of funds appropriated or transferred out of the hurricane reserve trust fund under sections 4 and 5 of Act 62, Session Laws of Hawaii 2011, shall be deposited into the hurricane reserve trust fund in fiscal year 2013-2014 and in fiscal year 2014-2015; provided that the deposit required in each fiscal year shall be made by October 1 of that fiscal year; and
(3) Commencing with fiscal year 2018-2019, a sum
from all general excise tax revenues realized by the State that represents the
difference between the state public employer's annual required contribution for
the separate trust fund established under section 87A-42 and the amount of the
state public employer's contributions into that trust fund shall be deposited
to the credit of the State's annual required contribution into that trust fund
in each fiscal year, as provided in section 87A-42.
(c) Notwithstanding subsection (b), for taxable
years beginning on or after January 1, 2025 and ending on or before December 31,
2028, the additional revenues generated and collected from the increase in
general excise tax rates imposed by sections 3, 4, 5, and 6 of Act ,
Session Laws of Hawaii 2025, shall be deposited into the general fund."
PART IV
SECTION 8. Section 235-7, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:
"(a) There shall be excluded from gross income, adjusted gross income, and taxable income:
(1) Income not subject to taxation by the State under the Constitution and laws of the United States;
(2) Rights, benefits, and other income exempted from taxation by section 88-91, having to do with the state retirement system, and the rights, benefits, and other income, comparable to the rights, benefits, and other income exempted by section 88-91, under any other public retirement system;
(3) Any compensation received in the form of a pension for past services;
(4) Compensation paid to a patient affected with Hansen's disease employed by the State or the United States in any hospital, settlement, or place for the treatment of Hansen's disease;
(5) Except as otherwise expressly provided, payments made by the United States or this State, under an act of Congress or a law of this State, which by express provision or administrative regulation or interpretation are exempt from both the normal and surtaxes of the United States, even though not so exempted by the Internal Revenue Code itself;
(6) Any income expressly exempted or excluded from the measure of the tax imposed by this chapter by any other law of the State, it being the intent of this chapter not to repeal or supersede any such express exemption or exclusion;
(7) Income received by each member of the reserve components of the Army, Navy, Air Force, Marine Corps, or Coast Guard of the United States of America, and the Hawaii National Guard as compensation for performance of duty, equivalent to pay received for forty-eight drills (equivalent of twelve weekends) and fifteen days of annual duty, at an:
(A) E-1 pay grade after eight years of service; provided that this subparagraph shall apply to taxable years beginning after December 31, 2004;
(B) E-2 pay grade after eight years of service; provided that this subparagraph shall apply to taxable years beginning after December 31, 2005;
(C) E-3 pay grade after eight years of service; provided that this subparagraph shall apply to taxable years beginning after December 31, 2006;
(D) E-4 pay grade after eight years of service; provided that this subparagraph shall apply to taxable years beginning after December 31, 2007; and
(E) E-5 pay grade after eight years of service; provided that this subparagraph shall apply to taxable years beginning after December 31, 2008;
(8) Income derived from the operation of
ships or aircraft if the income is exempt under the Internal Revenue Code
pursuant to the provisions of an income tax treaty or agreement entered into by
and between the United States and a foreign country[[];[]]
provided that the tax laws of the local governments of that country
reciprocally exempt from the application of all of their net income taxes, the
income derived from the operation of ships or aircraft that are documented or
registered under the laws of the United States;
(9) The value of legal services provided by a legal service plan to a taxpayer, the taxpayer's spouse, and the taxpayer's dependents;
(10) Amounts paid, directly or indirectly, by a legal service plan to a taxpayer as payment or reimbursement for the provision of legal services to the taxpayer, the taxpayer's spouse, and the taxpayer's dependents;
(11) Contributions by an employer to a legal
service plan for compensation (through insurance or otherwise) to the
employer's employees for the costs of legal services incurred by the employer's
employees, their spouses, and their dependents; [and]
(12) Amounts received in the form of a
monthly surcharge by a utility acting on behalf of an affected utility under
section 269-16.3; provided that amounts retained by the acting utility for
collection or other costs shall not be included in this exemption[.];
and
(13) Income received as unemployment compensation benefits under chapter 383."
SECTION 9. Section 383-163.6, Hawaii Revised Statutes, is amended by amending its title and subsection (a) to read as follows:
"[[]§383-163.6[]]
Voluntary
deduction and withholding of federal and state income taxes. (a) An
individual filing a new claim for unemployment compensation shall, at the time
of filing the claim, be advised that:
(1) Unemployment compensation is subject to
federal [and state] income tax;
(2) Requirements exist pertaining to estimated tax payments;
(3) The individual may elect to have federal income tax deducted and withheld from the individual's payment of unemployment compensation at the amount specified in the federal Internal Revenue Code;
(4) The individual may elect to have state income tax deducted and withheld from the individual's payment of unemployment compensation at the amount specified in section 235-69;
(5) The individual may elect to have state and local income taxes deducted and withheld from the individual's payment of unemployment compensation for other states and localities outside this State at the percentage established by the state or locality, if the department by agreement with the other state or locality is authorized to deduct and withhold income tax; and
(6) The individual shall be permitted to change a previously elected withholding status no more than once during a benefit year."
PART V
SECTION 10. Section 235-2.4, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:
"(a) Section 63 (with respect to taxable income defined) of the Internal Revenue Code shall be operative for the purposes of this chapter, subject to the following:
(1) Section 63(c)(1)(B) (relating to the additional standard deduction), 63(c)(1)(C) (relating to the real property tax deduction), 63(c)(1)(D) (relating to the disaster loss deduction), 63(c)(1)(E) (relating to the motor vehicle sales tax deduction), 63(c)(4) (relating to inflation adjustments), 63(c)(7) (defining the real property tax deduction), 63(c)(8) (defining the disaster loss deduction), 63(c)(9) (defining the motor vehicle sales tax deduction), and 63(f) (relating to additional amounts for the aged or blind) of the Internal Revenue Code shall not be operative for purposes of this chapter;
(2) Section 63(c)(2) (relating to the basic standard deduction) of the Internal Revenue Code shall be operative, except that the standard deduction amounts provided therein shall instead mean:
(A) $4,400 or $8,800 for a return with an adjusted gross income of less than $200,000, in the case of:
(i) A joint return as provided by section 235‑93; or
(ii) A surviving spouse (as defined in section 2(a) of the Internal Revenue Code);
(B) $3,212 or $6,424 for a return with an adjusted gross income less than $100,000, in the case of a head of household (as defined in section 2(b) of the Internal Revenue Code);
(C) $2,200 or $4,400 for a return with an adjusted gross income less than $100,000, in the case of an individual who is not married and who is not a surviving spouse or head of household;
(D) $2,200 or $4,400 for a return with an adjusted gross income less than $100,000, in the case of a married individual filing a separate return;
[(E) For taxable years beginning after
December 31, 2023:
(i) $8,800 in the case of a joint return
as provided by section 235-93 or a surviving spouse (as defined in section 2(a)
of the Internal Revenue Code);
(ii) $6,424 in the case of a head of
household (as defined in section 2(b) of the Internal Revenue Code);
(iii) $4,400 in the case of an individual
who is not married and who is not a surviving spouse or head of household; or
(iv) $4,400 in the case of a married
individual filing a separate return;
(F) For taxable years beginning after
December 31, 2025:
(i) $16,000 in the case of a joint
return as provided by section 235-93 or a surviving spouse (as defined in
section 2(a) of the Internal Revenue Code);
(ii) $12,000 in the case of a head of
household (as defined in section 2(b) of the Internal Revenue Code);
(iii) $8,000 in the case of an individual
who is not married and who is not a surviving spouse or head of household; or
(iv) $8,000 in the case of a married
individual filing a separate return;
(G) For taxable years beginning after
December 31, 2027:
(i) $18,000 in the case of a joint
return as provided by section 235-93 or a surviving spouse (as defined in
section 2(a) of the Internal Revenue Code);
(ii) $13,500 in the case of a head of
household (as defined in section 2(b) of the Internal Revenue Code);
(iii) $9,000 in the case of an individual
who is not married and who is not a surviving spouse or head of household; or
(iv) $9,000 in the case of a married
individual filing a separate return;
(H) For taxable years beginning after
December 31, 2029:
(i) $20,000 in the case of a joint
return as provided by section 235-93 or a surviving spouse (as defined in
section 2(a) of the Internal Revenue Code);
(ii) $15,000 in the case of a head of
household (as defined in section 2(b) of the Internal Revenue Code);
(iii) $10,000 in the case of an individual
who is not married and who is not a surviving spouse or head of household; or
(iv) $10,000 in the case of a married
individual filing a separate return; and
(I) For taxable years beginning after
December 31, 2030:
(i) $24,000 in the case of a joint
return as provided by section 235-93 or a surviving spouse (as defined in
section 2(a) of the Internal Revenue Code);
(ii) $18,000 in the case of a head of
household (as defined in section 2(b) of the Internal Revenue Code);
(iii) $12,000 in the case of an individual
who is not married and who is not a surviving spouse or head of household; or
(iv) $12,000 in the case of a married
individual filing a separate return;]
(3) Section 63(c)(5) (limiting the basic standard deduction in the case of certain dependents) of the Internal Revenue Code shall be operative, except that the limitation shall be the greater of $500 or the individual's earned income; and
(4) The standard deduction amount for nonresidents shall be calculated pursuant to section 235-5."
PART
VI
SECTION 11. Section 235-55.7, Hawaii Revised Statutes, is amended as follows:
1. By amending subsections (a) through (c) to read:
"(a) As used in this section:
[(1)] "Adjusted gross income" [is
defined by section 235‑1.] has the same meaning as defined in title
26 United States Code section 62, Internal Revenue Code of 1986, as amended.
[(2)] "Qualified exemption"
includes those exemptions permitted under this chapter; provided that a person
for whom exemption is claimed has physically resided in the State for more than
nine months during the taxable year; [and] provided further that
multiple [exemption] exemptions shall not be granted because of
deficiencies in vision, hearing, or other disability.
[(3)] "Rent" means the amount paid in
cash in any taxable year for the occupancy of a dwelling place [which] that
is used by a resident taxpayer or the resident taxpayer's immediate family as
the principal residence in this State.
Rent is limited to the amount paid for the occupancy of the dwelling
place only, [and] or is exclusive of charges for utilities,
parking stalls, storage of goods, yard services, furniture, furnishings, and
the like. Rent shall not include any
rental claimed as a deduction from gross income or adjusted gross income for
income tax purposes, any ground rental paid for use of land only, [and] or
any rent allowance or subsidies received.
(b) Each resident taxpayer who occupies and pays
rent for real property within the State as the resident taxpayer's residence or
the residence of the resident taxpayer's immediate family [which] that
is not partially or wholly exempted from real property tax, who is not eligible
to be claimed as a dependent for federal or state income taxes by another, and
who files an individual net income tax return for a taxable year, may claim a
tax credit under this section against the resident taxpayer's Hawaii state
individual net income tax.
(c) Each taxpayer with an adjusted gross income
of less than [$30,000] $50,000 who has paid more than $1,000 in
rent during the taxable year for which the credit is claimed may claim a tax
credit of [$50] $500 multiplied by the number of qualified
exemptions to which the taxpayer is entitled; provided that each
taxpayer sixty-five years of age or over may claim double the tax credit; [and]
provided further that a resident individual who has no income or no
income taxable under this chapter may also claim the tax credit as set forth in
this section."
2. By amending subsection (e) to read:
"(e) The tax credits shall be deductible from the
taxpayer's individual net income tax for the tax year in which the credits are
properly claimed; provided that [a husband and wife] married
individuals filing separate returns for a taxable year for which a joint
return could have been made by them shall claim only the tax credits to which
they would have been entitled had a joint return been filed. In the event the allowed tax credits exceed
the amount of the income tax payments due from the taxpayer, the excess of
credits over payments due shall be refunded to the taxpayer; provided that
allowed tax credits properly claimed by an individual who has no income tax
liability shall be paid to the individual; [and] provided further that
no refunds or payments on account of the tax credits allowed by this section
shall be made for amounts less than $1."
3. By amending subsection (h) to read:
"(h) Claims for tax credits under this section,
including any amended claims [thereof], shall be filed on or before the
end of the twelfth month following the taxable year for which the credit may be
claimed."
PART VII
SECTION 12. Section 235-51, Hawaii Revised Statutes, is amended by amending subsections (a) to (c) to read as follows:
"(a)
There is hereby imposed on the taxable income of every:
(1) Taxpayer who files a joint return under
section 235‑93; and
(2) Surviving spouse,
a tax
determined in accordance with the following table:
In the case of any taxable year beginning
after December 31, 2017:
If the taxable income is: The tax shall be:
Not over $4,800 1.40% of taxable income
Over $4,800 but $67.00 plus 3.20% of
not over $9,600 excess over $4,800
Over $9,600 but $221.00 plus 5.50% of
not over $19,200 excess over $9,600
Over $19,200 but $749.00 plus 6.40% of
not over $28,800 excess over $19,200
Over $28,800 but $1,363.00 plus 6.80% of
not over $38,400 excess over $28,800
Over $38,400 but $2,016.00 plus 7.20% of
not over $48,000 excess over $38,400
Over $48,000 but $2,707.00 plus 7.60% of
not over $72,000 excess over $48,000
Over $72,000 but $4,531.00 plus 7.90% of
not over $96,000 excess over $72,000
Over $96,000 but $6,427.00 plus 8.25% of
not over $300,000 excess over $96,000
Over $300,000 but $23,257.00 plus 9.00% of
not over $350,000 excess over $300,000
Over
$350,000 but $27,757.00 plus
10.00% of
not over $400,000 excess over $350,000
Over
$400,000 $32,757.00 plus
11.00% of
excess
over $400,000.
[In the case of any taxable year
beginning after December 31, 2024:
If the taxable income is: The tax shall be:
Not over $19,200 1.40% of taxable income
Over $19,200 but $269.00 plus 3.20% of
not over $28,800 excess over $19,200
Over $28,800 but $576.00 plus 5.50% of
not over $38,400 excess over $28,800
Over $38,400 but $1,104.00 plus 6.40% of
not over $48,000 excess over $38,400
Over $48,000 but $1,718.00 plus 6.80% of
not over $72,000 excess over $48,000
Over $72,000 but $3,350.00 plus 7.20% of
not over $96,000 excess over $72,000
Over $96,000 but $5,078.00 plus 7.60% of
not over $250,000 excess over $96,000
Over $250,000 but $16,782.00 plus 7.90% of
not over $350,000 excess over $250,000
Over $350,000 but $24,682.00 plus 8.25% of
not over $450,000 excess over $350,000
Over $450,000 but $32,932.00 plus 9.00% of
not over $550,000 excess over $450,000
Over
$550,000 but $41,932.00
plus 10.00% of
not over $650,000 excess over $550,000
Over
$650,000 $51,932.00
plus 11.00% of
excess
over $650,000.
In the case of any taxable year
beginning after December 31, 2026:
If the taxable income is: The tax shall be:
Not over $28,800 1.40% of taxable income
Over $28,800 but $403.00 plus 3.20% of
not over $38,400 excess over $28,800
Over $38,400 but $710.00 plus 5.50% of
not over $48,000 excess over $38,400
Over $48,000 but $1,238.00 plus 6.40% of
not over $72,000 excess over $48,000
Over $72,000 but $2,774.00 plus 6.80% of
not over $96,000 excess over $72,000
Over $96,000 but $4,406.00 plus 7.20% of
not over $250,000 excess over $96,000
Over $250,000 but $15,494.00 plus 7.60% of
not over $350,000 excess over $250,000
Over $350,000 but $23,094.00 plus 7.90% of
not over $450,000 excess over $350,000
Over $450,000 but $30,994.00 plus 8.25% of
not over $550,000 excess over $450,000
Over $550,000 but $39,244.00 plus 9.00% of
not over $650,000 excess over $550,000
Over
$650,000 but $48,244.00
plus 10.00% of
not over $800,000 excess over $650,000
Over
$800,000 $63,244.00
plus 11.00% of
excess
over $800,000.
In the case of any taxable year
beginning after December 31, 2028:
If the taxable income is: The tax shall be:
Not over $38,400 1.40% of taxable income
Over $38,400 but $538.00 plus 3.20% of
not over $48,000 excess over $38,400
Over $48,000 but $845.00 plus 5.50% of
not over $72,000 excess over $48,000
Over $72,000 but $2,165.00 plus 6.40% of
not over $96,000 excess over $72,000
Over $96,000 but $3,701.00 plus 6.80% of
not over $250,000 excess over $96,000
Over $250,000 but $14,173.00 plus 7.20% of
not over $350,000 excess over $250,000
Over $350,000 but $21,373.00 plus 7.60% of
not over $450,000 excess over $350,000
Over $450,000 but $28,973.00 plus 7.90% of
not over $550,000 excess over $450,000
Over $550,000 but $36,873.00 plus 8.25% of
not over $650,000 excess over $550,000
Over $650,000 but $45,123.00 plus 9.00% of
not over $800,000 excess over $650,000
Over
$800,000 but $58,623.00
plus 10.00% of
not over $950,000 excess over $800,000
Over
$950,000 $73,623.00
plus 11.00% of
excess
over $950,000.]
In the case of any taxable year
beginning after December 31, 2025:
If the taxable income is: The tax shall be:
Not over $100,000 0% of taxable income
Over $100,000 but $0 plus 8.25% of
not
over $300,000 excess
over $100,000
Over $300,000 but $16,500 plus 9.00% of
not over $350,000 excess over $300,000
Over $350,000 but $21,000 plus 10.0% of
not over $400,000 excess over $350,000
Over
$400,000 $26,000
plus 11.00% of
excess
over $400,000.
(b)
There is hereby imposed on the taxable income of every head of a
household a tax determined in accordance with the following table:
In the case of any taxable year beginning
after December 31, 2017:
If the taxable income is: The tax shall be:
Not over $3,600 1.40% of taxable income
Over $3,600 but $50.00 plus 3.20% of
not over $7,200 excess over $3,600
Over $7,200 but $166.00 plus 5.50% of
not over $14,400 excess over $7,200
Over $14,400 but $562.00 plus 6.40% of
not over $21,600 excess over $14,400
Over $21,600 but $1,022.00 plus 6.80% of
not over $28,800 excess over $21,600
Over $28,800 but $1,512.00 plus 7.20% of
not over $36,000 excess over $28,800
Over $36,000 but $2,030.00 plus 7.60% of
not over $54,000 excess over $36,000
Over $54,000 but $3,398.00 plus 7.90% of
not over $72,000 excess over $54,000
Over $72,000 but $4,820.00 plus 8.25% of
not over $225,000 excess over $72,000
Over $225,000 but $17,443.00 plus 9.00% of
not over $262,500 excess over $225,000
Over
$262,500 but $20,818.00 plus
10.00% of
not over $300,000 excess over $262,500
Over
$300,000 $24,568.00 plus
11.00% of
excess
over $300,000.
[In the case of any taxable year
beginning after December 31, 2024:
If the taxable income is: The tax shall be:
Not over $14,400 1.40% of taxable income
Over $14,400 but $202.00 plus 3.20% of
not over $21,600 excess over $14,400
Over $21,600 but $432.00 plus 5.50% of
not over $28,800 excess over $21,600
Over $28,800 but $828.00 plus 6.40% of
not over $36,000 excess over $28,800
Over $36,000 but $1,289.00 plus 6.80% of
not over $54,000 excess over $36,000
Over $54,000 but $2,513.00 plus 7.20% of
not over $72,000 excess over $54,000
Over $72,000 but $3,809.00 plus 7.60% of
not over $187,500 excess over $72,000
Over $187,500 but $12,587.00 plus 7.90% of
not over $262,500 excess over $187,500
Over $262,500 but $18,512.00 plus 8.25% of
not over $337,500 excess over $262,500
Over $337,500 but $24,699.00 plus 9.00% of
not over $412,500 excess over $337,500
Over
$412,500 but $31,449.00
plus 10.00% of
not over $487,500 excess over $412,500
Over
$487,500 $38,949.00
plus 11.00% of
excess
over $487,500.
In the case of any taxable year
beginning after December 31, 2026:
If the taxable income is: The tax shall be:
Not over $21,600 1.40% of taxable income
Over $21,600 but $302.00 plus 3.20% of
not over $28,800 excess over $21,600
Over $28,800 but $533.00 plus 5.50% of
not over $36,000 excess over $28,800
Over $36,000 but $929.00 plus 6.40% of
not over $54,000 excess over $36,000
Over $54,000 but $2,081.00 plus 6.80% of
not over $72,000 excess over $54,000
Over $72,000 but $3,305.00 plus 7.20% of
not over $187,500 excess over $72,000
Over $187,500 but $11,621.00 plus 7.60% of
not over $262,500 excess over $187,500
Over $262,500 but $17,321.00 plus 7.90% of
not over $337,500 excess over $262,500
Over $337,500 but $23,246.00 plus 8.25% of
not over $412,500 excess over $337,500
Over $412,500 but $29,433.00 plus 9.00% of
not over $487,500 excess over $412,500
Over
$487,500 but $36,183.00
plus 10.00% of
not over $600,000 excess over $487,500
Over
$600,000 $47,433.00
plus 11.00% of
excess
over $600,000.
In the case of any taxable year
beginning after December 31, 2028:
If the taxable income is: The tax shall be:
Not over $28,800 1.40% of taxable income
Over $28,800 but $403.00 plus 3.20% of
not over $36,000 excess over $28,800
Over $36,000 but $634.00 plus 5.50% of
not over $54,000 excess over $36,000
Over $54,000 but $1,624.00 plus 6.40% of
not over $72,000 excess over $54,000
Over $72,000 but $2,776.00 plus 6.80% of
not over $187,500 excess over $72,000
Over $187,500 but $10,630.00 plus 7.20% of
not over $262,500 excess over $187,500
Over $262,500 but $16,030.00 plus 7.60% of
not over $337,500 excess over $262,500
Over $337,500 but $21,730.00 plus 7.90% of
not over $412,500 excess over $337,500
Over $412,500 but $27,655.00 plus 8.25% of
not over $487,500 excess over $412,500
Over $487,500 but $33,842.00 plus 9.00% of
not over $600,000 excess over $487,500
Over
$600,000 but $43,967.00
plus 10.00% of
not over $712,500 excess over $600,000
Over
$712,500 $55,217.00
plus 11.00% of
excess
over $712,500.]
In the case of any taxable year
beginning after December 31, 2025:
If the taxable income is: The tax shall be:
Not over $100,000 0% of taxable income
Over $100,000 but $0 plus 8.25% of
not over $225,000 excess over $100,000
Over $225,000 but $10,313 plus 9.00% of
not over $262,500 excess over $225,000
Over $262,500 but $13,688 plus 10.0% of
not over $300,000 excess over $262,500
Over
$300,000 $17,438
plus 11.00% of
excess
over $300,000.
(c)
There is hereby imposed on the taxable income of (1) every unmarried
individual (other than a surviving spouse, or the head of a household) and (2)
on the taxable income of every married individual who does not make a single
return jointly with the individual's spouse under section 235-93 a tax
determined in accordance with the following table:
In the case of any taxable year beginning
after December 31, 2017:
If the taxable income is: The tax shall be:
Not over $2,400 1.40% of taxable income
Over $2,400 but $34.00 plus 3.20% of
not over $4,800 excess over $2,400
Over $4,800 but $110.00 plus 5.50% of
not over $9,600 excess over $4,800
Over $9,600 but $374.00 plus 6.40% of
not over $14,400 excess over $9,600
Over $14,400 but $682.00 plus 6.80% of
not over $19,200 excess over $14,400
Over $19,200 but $1,008.00 plus 7.20% of
not over $24,000 excess over $19,200
Over $24,000 but $1,354.00 plus 7.60% of
not over $36,000 excess over $24,000
Over $36,000 but $2,266.00 plus 7.90% of
not over $48,000 excess over $36,000
Over
$48,000 but $3,214.00 plus
8.25% of
not over $150,000 excess over $48,000
Over $150,000 but $11,629.00 plus 9.00% of
not over $175,000 excess over $150,000
Over
$175,000 but $13,879.00 plus
10.00% of
not over $200,000 excess over $175,000
Over
$200,000 $16,379.00 plus
11.00% of
excess
over $200,000.
[In the case of any taxable year
beginning after December 31, 2024:
If the taxable income is: The tax shall be:
Not over $9,600 1.40% of taxable income
Over $9,600 but $134.00 plus 3.20% of
not over $14,400 excess over $9,600
Over $14,400 but $288.00 plus 5.50% of
not over $19,200 excess over $14,400
Over $19,200 but $552.00 plus 6.40% of
not over $24,000 excess over $19,200
Over $24,000 but $859.00 plus 6.80% of
not over $36,000 excess over $24,000
Over $36,000 but $1,675.00 plus 7.20% of
not over $48,000 excess over $36,000
Over $48,000 but $2,539.00 plus 7.60% of
not over $125,000 excess over $48,000
Over $125,000 but $8,391.00 plus 7.90% of
not over $175,000 excess over $125,000
Over $175,000 but $12,341.00 plus 8.25% of
not over $225,000 excess over $175,000
Over $225,000 but $16,466.00 plus 9.00% of
not over $275,000 excess over $225,000
Over
$275,000 but $20,966.00
plus 10.00% of
not over $325,000 excess over $275,000
Over
$325,000 $25,966.00
plus 11.00% of
excess
over $325,000.
In the case of any taxable year
beginning after December 31, 2026:
If the taxable income is: The tax shall be:
Not over $14,400 1.40% of taxable income
Over $14,400 but $202.00 plus 3.20% of
not over $19,200 excess over $14,400
Over $19,200 but $355.00 plus 5.50% of
not over $24,000 excess over $19,200
Over $24,000 but $619.00 plus 6.40% of
not over $36,000 excess over $24,000
Over $36,000 but $1,387.00 plus 6.80% of
not over $48,000 excess over $36,000
Over $48,000 but $2,203.00 plus 7.20% of
not over $125,000 excess over $48,000
Over $125,000 but $7,747.00 plus 7.60% of
not over $175,000 excess over $125,000
Over $175,000 but $11,547.00 plus 7.90% of
not over $225,000 excess over $175,000
Over $225,000 but $15,497.00 plus 8.25% of
not over $275,000 excess over $225,000
Over $275,000 but $19,622.00 plus 9.00% of
not over $325,000 excess over $275,000
Over
$325,000 but $24,122.00
plus 10.00% of
not over $400,000 excess over $325,000
Over
$400,000 $31,622.00
plus 11.00% of
excess
over $400,000.
In the case of any taxable year
beginning after December 31, 2028:
If the taxable income is: The tax shall be:
Not over $19,200 1.40% of taxable income
Over $19,200 but $269.00 plus 3.20% of
not over $24,000 excess over $19,200
Over $24,000 but $422.00 plus 5.50% of
not over $36,000 excess over $24,000
Over $36,000 but $1,082.00 plus 6.40% of
not over $48,000 excess over $36,000
Over $48,000 but $1,850.00 plus 6.80% of
not over $125,000 excess over $48,000
Over $125,000 but $7,086.00 plus 7.20% of
not over $175,000 excess over $125,000
Over $175,000 but $10,686.00 plus 7.60% of
not over $225,000 excess over $175,000
Over $225,000 but $14,486.00 plus 7.90% of
not over $275,000 excess over $225,000
Over $275,000 but $18,436.00 plus 8.25% of
not over $325,000 excess over $275,000
Over $325,000 but $22,561.00 plus 9.00% of
not over $400,000 excess over $325,000
Over
$400,000 but $29,311.00
plus 10.00% of
not over $475,000 excess over $400,000
Over
$475,000 $36,811.00
plus 11.00% of
excess
over $475,000.]
In the case of any taxable year
beginning after December 31, 2025:
If the taxable income is: The tax shall be:
Not over $100,000 0% of taxable income
Over $100,000 but $0 plus 8.25% of
not over $150,000 excess over $100,000
Over $150,000 but $4,125 plus 9.00% of
not over $175,000 excess over $150,000
Over $175,000 but $6,375 plus 10.0% of
not over $200,000 excess over $175,000
Over
$200,000 $8,875 plus
11.00% of
excess
over $200,000."
PART VIII
SECTION 13. Chapter 248, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:
"§248- Maui recovery special fund. (a) There is established in the
state treasury the Maui recovery special fund, into which shall be deposited:
(1) Appropriations made by the
legislature;
(2) Contributions from public or private
partners; and
(3) Interest earned on or accrued to
moneys deposited in the special fund.
(b) Moneys in the Maui recovery special fund
shall be used for recovery programs, capital improvement projects, and
assistance to those impacted by the 2023 Maui wildfires."
SECTION
14. There
is appropriated out of the general revenues of the State of Hawaii the sum of $
or so much thereof as may be necessary for fiscal year 2025–2026 and the
same sum or so much thereof as may be necessary for fiscal year 2026-2027
to be deposited into the Maui recovery special fund.
SECTION
15. There
is appropriated out of the Maui recovery special fund the sum of $
or so much thereof as may be necessary for fiscal year 2025–2026 and the
same sum or so much thereof as may be necessary for fiscal year 2026-2027
for recovery programs, capital improvement projects, and assistance to
individuals impacted by the 2023 Maui wildfires pursuant to section
248- .
The sums appropriated shall be expended by the county of Maui for the purposes of this Act.
PART IX
SECTION 16. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.
SECTION 17. This Act, upon its approval, shall apply to taxable years beginning after December 31, 2024; provided that part VIII of this Act shall take effect on July 1, 2025.
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Report Title:
General Excise Tax; Groceries; Nonprescription Drugs; Income Tax; Income Tax Brackets; Standard Deduction; Unemployment Insurance; Exemptions; Maui Recovery Special Fund; Appropriations
Description:
Exempts the sale of groceries and nonprescription drugs from the general excise tax. Incrementally increases the general excise tax over four years, with the increased proceeds during certain fiscal years to be deposited into the general fund. Removes the state income tax on unemployment compensation benefits. Doubles the standard deduction for individuals earning less than $100,000 and joint returns earning less than $200,000. Repeals the incremental increases on standard income tax deduction amounts. Increases the minimum income threshold and exemption amount for the low-income household renters' income tax credit. Removes the tax liability for the first $100,000 of individual income earned. Establishes the Maui Recovery Special Fund to be used for recovery programs related to the 2023 Maui wildfires. Appropriates funds. Applies to taxable years beginning after 12/31/2024.
The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.
