Bill Text: HI SR31 | 2016 | Regular Session | Introduced

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Bill Title: Tax Review Commission; Internal Revenue Code Conformity Study

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Passed) 2016-04-07 - Report and Resolution Adopted. [SR31 Detail]

Download: Hawaii-2016-SR31-Introduced.html

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THE SENATE	S.R. NO.	31
TWENTY-EIGHTH LEGISLATURE, 2016
STATE OF HAWAII

SENATE RESOLUTION

 

 

REQUESTING THE TAX REVIEW COMMISSION TO STUDY CONFORMITY OF STATE INCOME TAX LAW WITH THE INTERNAL REVENUE CODE AS IT RELATES TO THE STANDARD DEDUCTION AND PERSONAL EXEMPTION.

 

 

     WHEREAS, it is anticipated that a Tax Review Commission will be appointed in 2016; and

 

     WHEREAS, Article VII, section 3, of the Hawaii State Constitution, requires the Tax Review Commission to, among other things, evaluate the State's tax structure and recommend tax policy; and

 

     WHEREAS, proposed changes to the standard deduction and personal exemption are tax policy issues that are submitted for consideration by the Legislature at each regular session; and

 

     WHEREAS, under chapter 235, Hawaii Revised Statutes, the standard deduction is statutorily set at the following specific amounts:

 

     (1)  $4,400 for joint filers or a surviving spouse;

 

     (2)  $3,212 for a head of household; and

 

     (3)  $2,200 for single filers or married individuals who file separate returns; and

 

     WHEREAS, under chapter 235, Hawaii Revised Statutes, the personal exemption is statutorily set at $1,144, with additional exemptions available for taxpayers and their spouses who are over sixty-five years of age; and

 

     WHEREAS, the amounts of the standard deduction and personal exemption set forth in the Internal Revenue Code are higher than the amounts set forth in chapter 235, Hawaii Revised Statutes; and

 

     WHEREAS, chapter 235, Hawaii Revised Statutes, does not provide for the automatic adjustment of the standard deduction and personal exemption for inflation; and

 

     WHEREAS, in contrast, under the Internal Revenue Code, the standard deduction, personal exemption, and income tax brackets are indexed for inflation; and

 

     WHEREAS, the issue of whether the standard deduction and personal exemption should be increased or conformed to the Internal Revenue Code has various ramifications that require an independent and objective evaluation by experts; and

 

     WHEREAS, consequently, an evaluation of the standard deduction and personal exemption by the Tax Review Commission is both appropriate and necessary; now, therefore,

 

     BE IT RESOLVED by the Senate of the Twenty-eighth Legislature of the State of Hawaii, Regular Session of 2016, that the Tax Review Commission is requested to evaluate whether the standard deduction and personal exemption under chapter 235, Hawaii Revised Statutes, should be increased or conformed with the Internal Revenue Code; and

 

     BE IT FURTHER RESOLVED that, as part of the evaluation, the Tax Review Commission is requested to:

 

     (1)  Consider whether the standard deduction and personal exemption should be indexed to inflation, as currently provided under the Internal Revenue Code; and

 

     (2)  Include estimates of the revenue impacts of its recommendations, as well the revenue impacts of any alternatives considered; and

 

     BE IT FURTHER RESOLVED that the Tax Review Commission is requested to include the findings and recommendations of the evaluation in its final report to the Governor and Legislature; and

 

     BE IT FURTHER RESOLVED that certified copies of this Resolution be transmitted to the Governor, Director of Taxation, and the Chairperson of the Tax Review Commission.

 

 

 

	OFFERED BY:	_____________________________

Report Title: 

Tax Review Commission; Internal Revenue Code Conformity Study