HOUSE OF REPRESENTATIVES

H.B. NO.

1147

TWENTY-SIXTH LEGISLATURE, 2011

 

STATE OF HAWAII

 

 

 

 

 

 

A BILL FOR AN ACT

 

 

relating to capital business improvements.

 

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 


     SECTION 1.  Chapter 235, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

     "§235-    Capital business improvements tax credit.  (a)  There shall be allowed to each taxpayer subject to the tax imposed by this chapter, a capital business improvements tax credit that shall be deductible from the taxpayer's net income tax liability, if any, imposed by this chapter in the taxable year in which the credit is properly claimed.  For the purposes of this section, "net income tax liability" means net income tax liability reduced by all other credits claimed by the taxpayer under this chapter.

     (b)  The amount of the credit shall be equal to the cost of the capital business improvements made by a taxpayer who owns a business in the State pursuant to a business plan submitted by the taxpayer for that business to the department of business, economic development, and tourism; provided that:

     (1)  The department of business, economic development, and tourism approves the plan;

     (2)  The tax credit takes effect only after the taxpayer achieves seventy-five per cent of the objectives of the plan; and

     (3)  The plan includes the hiring of at least five new full-time employees.

     (c)  If the tax credit under this section exceeds the taxpayer's income tax liability, the excess of the credit over the liability may be used by the taxpayer until the income tax liability is exhausted.

     (d)  All claims for a tax credit under this section shall be filed on or before the end of the twelfth month following the close of the taxable year for which the credit may be claimed.  Failure to properly and timely claim the credit shall constitute a waiver of the right to claim the credit.

     (e)  The director of business, economic development, and tourism may adopt rules pursuant to chapter 91 to effectuate this section, including criteria and rules with respect to the capital business improvements plan under subsection (b).

     The director of taxation may adopt rules pursuant to chapter 91 to effectuate this section."

     SECTION 2.  New statutory material is underscored.

     SECTION 3.  This Act shall take effect upon its approval and apply to taxable years beginning after December 31, 2010.

 

INTRODUCED BY:

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Report Title:

Income Tax Credit; Capital Business Improvements

 

Description:

Provides a tax credit for certain capital business improvement costs expended by a business.

 

 

 

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