STAND. COM. REP. NO. _______7-00

                                 Honolulu, Hawaii
                                                   , 2000

                                 RE: H.B. No. 2080
                                     




Honorable Calvin K.Y. Say
Speaker, House of Representatives
Twentieth State Legislature
Regular Session of 2000
State of Hawaii

Sir:

     Your Committee on Public Safety and Military Affairs, to
which was referred H.B. No. 2080 entitled: 

     "A BILL FOR AN ACT RELATING TO TAX CREDITS,"

begs leave to report as follows:

     The purpose of this bill is to provide an exemption to
military personnel who do not file a joint return to qualify for
the household and dependent care tax credit.

     Your committee received testimony in support of this measure
on behalf of a member of the military who is a Hawaii resident
stationed in California.

     Currently, the law penalizes Hawaii military members who
choose to maintain Hawaii residency as they move to duty stations
outside the state if he or she is married to a non-resident of
Hawaii and does not file a joint Hawaii tax return.  Your
committee finds that these military citizens serving outside of
Hawaii deserve an exemption to allow them to claim this
deduction.  Your committee finds that without the credit it is
likely that military members will not choose to remain citizens
of Hawaii when they leave our state.

     As affirmed by the record of votes of the members of your
Committee on Public Safety and Military Affairs that is attached
to this report, your Committee is in accord with the intent and
purpose of H.B. No. 2080 and recommends that it pass Second
Reading and be referred to the Committee on Finance.

 
 
                                 STAND. COM. REP. NO. _______7-00
                                 Page 2

 
                                   Respectfully submitted on
                                   behalf of the members of the
                                   Committee on Public Safety and
                                   Military Affairs,



                                   ______________________________
                                   NESTOR R. GARCIA, Chair