STAND. COM. REP. NO. 2445

 

Honolulu, Hawaii

                  

 

RE:    S.B. No. 2163

       S.D. 1

 

 

 

Honorable Ronald D. Kouchi

President of the Senate

Twenty-Ninth State Legislature

Regular Session of 2018

State of Hawaii

 

Sir:

 

     Your Committees on Labor and Human Services, to which was referred S.B. No. 2163 entitled:

 

"A BILL FOR AN ACT RELATING TO TAXATION,"

 

beg leave to report as follows:

 

     The purpose and intent of this measure is to provide a taxpayer who hires an individual with a disability a nonrefundable tax credit for the six-month period after the individual is initially hired by the taxpayer.

 

     Your Committees received testimony in support of this measure from the State Rehabilitation Council; State Council on Developmental Disabilities; Hawaii State Association of Counties; Hawaii Disability Rights Center; Lanakila Pacific; Oahu County Committee on Legislative Priorities of the Democratic Party of Hawaii; Kauai County Councilmember Derek Kawakami; and one individual.  Your Committees received comments on this measure from the Department of Taxation and Tax Foundation Hawaii.

 

     Your Committees find that employment of people with disabilities is key to allowing them to achieve full community integration and financial independence.  Your Committees support incentives that encourage greater employment of individuals with disabilities in the State.

 

     Your Committees recommend that, as this measure moves through the legislative process, it should be evaluated as to whether or not expansion or amendment of existing tax incentives, such as those for vocational rehabilitation in section 235-55.91, Hawaii Revised Statutes, is preferable to the creation of a new one, as noted in the testimonies of the Department of Taxation and Tax Foundation of Hawaii.

 

     Your Committees have amended this measure by:

 

     (1)  Replacing references to "individual with a disability" with "person totally disabled", as defined in section 235-1, Hawaii Revised Statutes;

 

     (2)  Stipulating that any amounts upon which any other tax credit or deduction is calculated under chapter 235, Hawaii Revised Statutes, are not qualified wages for purposes of the tax credit;

 

     (3)  Clarifying that the Department of Taxation may disqualify wages that were paid to a non-qualified employee without the employer receiving notice that the certification was based on false information;

 

     (4)  Clarifying that only the final successor employer who employed the person totally disabled during the taxable year may claim the credit and that the credit cannot be claimed multiple times for the same employee; and

 

     (5)  Making technical, nonsubstantive amendments for the purposes of clarity and consistency.

 

     As affirmed by the records of votes of the members of your Committees on Labor and Human Services that are attached to this report, your Committees are in accord with the intent and purpose of S.B. No. 2163, as amended herein, and recommend that it pass Second Reading in the form attached hereto as S.B. No. 2163, S.D. 1, and be referred to your Committee on Ways and Means.

 


Respectfully submitted on behalf of the members of the Committees on Labor and Human Services,

 

________________________________

JOSH GREEN, Chair

 

________________________________

JILL N. TOKUDA, Chair