Bill Text: HI SB22 | 2013 | Regular Session | Introduced
Bill Title: Conveyance Tax; Sale of Stock; Realty
Spectrum: Partisan Bill (Democrat 3-0)
Status: (Introduced - Dead) 2013-02-11 - Report adopted; Passed Second Reading, as amended (SD 1) and referred to WAM. [SB22 Detail]
Download: Hawaii-2013-SB22-Introduced.html
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THE SENATE |
S.B. NO. |
22 |
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TWENTY-SEVENTH LEGISLATURE, 2013 |
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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 it is ambiguous whether or not existing law imposes a conveyance tax on the transfer or conveyance of realty in instances where an entity or individual sales, transfers, or exchanges stock of an entity that holds title to realty, or any interest therein, that is located in Hawaii to an unrelated entity or individual.
The purpose of this Act is to clarify that the selling, transfer, or exchange of a legal entity's stock, whose assets include realty located in Hawaii, shall be deemed to be a transfer or conveyance of realty that is subject to the conveyance tax when the sale, transfer, or exchange of the stock is executed with an unrelated entity or individual.
SECTION 2. Section 247-1, Hawaii Revised Statutes, is amended to read as follows:
"§247-1 Imposition of tax. (a) There is hereby imposed and shall be levied, collected, and paid, a tax as hereinafter provided, on all transfers or conveyances of realty or any interest therein, by way of deeds, leases, subleases, assignments of lease, agreements of sale, stock transfers under subsection (b), assignments of agreement of sale, instruments, writings, and any other document, whereby any lands, interests in land, tenements, or other realty sold shall be granted, assigned, transferred, or otherwise conveyed to, or vested in, the purchaser or purchasers, lessee or lessees, sublessee or sublessees, assignee or assignees, or any other person or persons, by the person's or their direction.
(b) For purposes of subsection (a), the sale or transfer of stock by a legal entity or individual that owns or leases realty in the State or has a controlling interest in the realty to an unrelated entity or individual, to the extent that the sale or transfer of stock reflects changes in ownership or control of the realty, shall be deemed a transfer or conveyance of an interest in the realty for purposes of subsection (a) and taxed accordingly. If the value of the realty transferred or conveyed cannot be determined from the value of the stock transferred, then the conveyance tax shall be based upon the most recent assessed appraised value of the realty or the amount of consideration paid for the stock transfer, whichever is greater.
(c) For purposes of this section:
"Controlling interest" means:
(1) In the case of a corporation, either fifty per cent or more of the total combined voting power of all classes of stock of the corporation entitled to vote, or fifty per cent or more of the capital, profits, or beneficial interest in the voting stock of the corporation; and
(2) In the case of a partnership, association, trust, or other entity, fifty per cent or more of the capital, profits, or beneficial interest in the partnership, association, trust, or other entity.
"Unrelated entity or individual" means an entity or individual that does not have a controlling interest in the transferring entity prior to the sale, transfer, or exchange of stock, or series of sales, transfers, or exchanges of stock within a twelve-month period."
SECTION 3. New statutory material is underscored.
SECTION 4. This Act, upon its approval, shall apply retroactively to applicable sales or transfers of stock occurring on or after June 1, 2012.
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INTRODUCED BY: |
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Report Title:
Conveyance Tax; Sale of Stock
Description:
Clarifies that the sale, transfer, or exchange of a legal entity's stock, whose assets include realty located in Hawaii, shall be deemed to be a transfer or conveyance of realty that is subject to the conveyance tax when the sale, transfer, or exchange of stock is executed with an unrelated entity or individual.
The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.
