STAND. COM. REP. NO. 559

 

Honolulu, Hawaii

                  

 

RE:    S.B. No. 1327

       S.D. 1

 

 

 

Honorable Colleen Hanabusa

President of the Senate

Twenty-Fifth State Legislature

Regular Session of 2009

State of Hawaii

 

Madam:

 

     Your Committee on Ways and Means, to which was referred S.B. No. 1327 entitled:

 

"A BILL FOR AN ACT RELATING TO THE RATE OF INTEREST APPLICABLE TO OVERPAYMENTS OF TAX,"

 

begs leave to report as follows:

 

     The purpose of this measure is to reduce the interest rate payable on refunds for an overpayment of taxes from two-thirds of one per cent to one-third of one per cent.

 

     One organization provided comments on the measure.

 

     As noted in comments submitted to the Committee, the rate of interest paid on overpayments and underpayments has not been adjusted in the State since 1967.  Your Committee finds that as a reflection of the current state of the economy, as well as an attempt by the State to manage expenses during a projected budget shortfall, reducing the interest rate of refunds for tax overpayment to one-third of one per cent on the overpayment of tax is fiscally prudent.  While not a substantial saving of state revenue by itself, this measure, when combined with other expense reducing measures under consideration by your Committee, should have an impact on the budget deficit.

 

     Your Committee has amended the measure to:  (1) Clarify that it applies only to taxable years beginning after December 31, 2008; and (2)  Make technical nonsubstantive amendments for purposes of clarity, consistency, and style.

 

As affirmed by the record of votes of the members of your Committee on Ways and Means that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 1327, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 1327, S.D. 1, and be placed on the calendar for Third Reading.

 

 

Respectfully submitted on behalf of the members of the Committee on Ways and Means,

 

 

 

____________________________

DONNA MERCADO KIM, Chair