REPORT TITLE:
GET - EXCLUSIONS


DESCRIPTION:
This Act seeks to exclude proceeds from the manufacture,
packaging and sale of food, residential rent, and the provision
of services and products for health care.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                        1812
HOUSE OF REPRESENTATIVES                H.B. NO.           
TWENTIETH LEGISLATURE, 2000                                
STATE OF HAWAII                                            
                                                             
________________________________________________________________
________________________________________________________________


                   A  BILL  FOR  AN  ACT

RELATING TO THE EXCLUSION OF FOOD, RESIDENTIAL RENT, AND HEALTH
   CARE SERVICES FROM THE GET.
 


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

 1      SECTION 1.  Perhaps one of the greatest obstacles facing
 
 2 Hawaii's drive toward excellence in the new millennium is our
 
 3 burdensome and regressive tax system.  The legislature finds that
 
 4 many residents of Hawaii face great difficulty affording the high
 
 5 cost of food, housing, and health care services.  Part of this
 
 6 high cost is attributable to the general excise tax, which is
 
 7 passed on to the consumer or intermediary.  Although the
 
 8 legislature passed a law reducing the effect of the pyramiding of
 
 9 the general excise tax, this approach does not deal with the true
 
10 heart of the matter.
 
11      We all need food to survive.  The same goes for shelter and
 
12 medical services. These are basic human needs.  The
 
13 disenfranchised among us - the chronically ill, the elderly, the
 
14 disabled, pregnant women, and our children - need these even
 
15 more.  Yet most live on fixed incomes, making the tax bite and
 
16 cost even more insidious.
 
17      The cost of basic human needs should not be a road block in
 
18 our drive towards excellence.  As a community, we cannot afford
 
19 the impact of our regressive general excise tax system.  The
 

 
Page 2                                                     1812
                                     H.B. NO.           
                                                        
                                                        

 
 1 purpose of this bill is to remove basic needs from the purview of
 
 2 the general excise tax.
 
 3      SECTION 2.  Chapter 237, Hawaii Revised Statutes, is amended
 
 4 by adding a new section to be appropriately designated and to
 
 5 read as follows:
 
 6      "237-  (a)Exemption for food.  There shall be exempted
 
 7 from, and excluded from the measure of, the taxes imposed by this
 
 8 chapter all of the gross proceeds or income arising from the
 
 9 manufacture, production, packaging, and sale of food items within
 
10 the State.
 
11           (1)  As used in this section, "food items" means any
 
12                food or food product for home consumption except
 
13                alcoholic beverages, tobacco, and hot food or hot
 
14                food products ready for immediate consumption,
 
15                and:
 
16                (A)  In the case of those persons who are sixty
 
17                     years of age or over or who receive
 
18                     supplemental security income benefits under
 
19                     Title XVI of the Social Security Act (42
 
20                     U.S.C. S1381 et seq.), and their spouses,
 
21                     includes meals prepared by and served in
 
22                     senior citizens' centers, apartment buildings
 
23                     occupied primarily by senior citizens,
 

 
Page 3                                                     1812
                                     H.B. NO.           
                                                        
                                                        

 
 1                     private nonprofit establishments (eating or
 
 2                     otherwise) that feed senior citizens, private
 
 3                     establishments that contract with the
 
 4                     appropriate agency of the State to offer
 
 5                     meals for senior citizens at concessional
 
 6                     prices, and meals prepared for and served to
 
 7                     residents of federally subsidized housing for
 
 8                     the elderly;
 
 9                (B)  In the case of persons sixty years of age or
 
10                     over and persons who are physically or
 
11                     mentally handicapped or otherwise so disabled
 
12                     that they are unable adequately to prepare
 
13                     all of their meals, includes meals prepared
 
14                     for and delivered to them and their spouses
 
15                     at their home by a public or private
 
16                     nonprofit organization or by a private
 
17                     establishment that contracts with the
 
18                     appropriate state agency to perform meal
 
19                     services at concessional prices;
 
20                (C)  In the case of narcotics addicts or
 
21                     alcoholics served by drug addiction or
 
22                     alcoholic treatment and rehabilitation
 
23                     programs, includes meals prepared and served
 

 
Page 4                                                     1812
                                     H.B. NO.           
                                                        
                                                        

 
 1                     under rehabilitation programs;
 
 2                (D)  In the case of disabled or blind recipients
 
 3                     of benefits under Title II or title XVI of
 
 4                     the Social Security Act (42 U.S.C. SS401 et
 
 5                     seq., 1381 et seq.) who are residents in a
 
 6                     public or private nonprofit group living
 
 7                     arrangement that serves not more than sixteen
 
 8                     residents and is certified by the appropriate
 
 9                     state agency or agencies under regulations
 
10                     issued under section 1616(e) of the Social
 
11                     Security Act (42 U.S.C. S1382(e)(1)),
 
12                     includes meals prepared and served under the
 
13                     arrangement; and
 
14                (E)  In the case of women and children temporarily
 
15                     residing in public or private nonprofit
 
16                     shelters for battered women and children,
 
17                     includes meals prepared and served by the
 
18                     residential shelters.
 
19      The phrase "food items" may be further defined by the
 
20 department fo taxation through the enumeration of items in rules
 
21 or informational releases, provided that the department shall
 
22 consult with the federal Food and Nutrition Service of the United
 
23 States Department of Agriculture in further defining the phrase
 

 
Page 5                                                     1812
                                     H.B. NO.           
                                                        
                                                        

 
 1 "food items" for food stamp purposes."
 
 2      SECTION 4.  Chapter 237, Hawaii Revised Statutes, is amended
 
 3 by adding a new section to be appropriately designated and to
 
 4 read as follows:
 
 5      "237-  Exemption for health care services and equipment.  
 
 6      (a) There shall be exempted from, and excluded from the
 
 7 measure of, the taxes imposed by this chapter all of the gross
 
 8 proceeds or income arising from the provision of health care
 
 9 services or equipment. 
 
10      (b) For purposes of this section, "health care services"
 
11 means services involved in the diagnosis, cure, mitigation,
 
12 treatment, or prevention of disease or the promotion of wellness
 
13 of body when provided by one of the following types of facilities
 
14 or people:
 
15           (1)nonprofit or for profit hospitals
 
16           (2)surgical outpatient facilities
 
17           (3)dialysis facilities
 
18           (4)infirmaries
 
19           (5)skilled nursing facilities
 
20           (6)intermediate care facilities
 
21           (7)adult residential care homes
 
22           (8)adult foster homes
 
23           (9)assisted living facilities
 

 
Page 6                                                     1812
                                     H.B. NO.           
                                                        
                                                        

 
 1           (10)adult day care facilities
 
 2           (11)pharmacies
 
 3           (12)sanitoriums
 
 4           (13)surface and air ambulances
 
 5           (14)persons holding a valid license under chapters 442,
 
 6           447, 448, 451A, 452, 453, 455, 457, 457A, 457G, 458,
 
 7           459, 460, 461, 461J, 463E, 465, 466J, and 468E.
 
 8      (c) As used in this section, "medical equipment" means any
 
 9 device, instrument, appliance, apparatus or contrivance,
 
10 electronic, mechanical, or otherwise that is intended for the use
 
11 in the diagnosis, cure, mitigation, treatment, or prevention of
 
12 disease or the promotion of wellness of body when provided by one
 
13 of the entities or persons listed in subsection (b)above."
 
14      SECTION 5.  Chapter 237, Hawaii Revised Statutes, is amended
 
15 by adding a new section to be appropriately designated and to
 
16 read as follows:
 
17      "237-   Exemption for residential rent.  There shall be
 
18 exempted from, and excluded from the measure of, the taxes
 
19 imposed by this chapter all of the gross proceeds or income
 
20 arising from the amounts of monies received by landlords,
 
21 lessors, and landowners as residential rent."
 
22      SECTION 6.  New statutory material is underscored.
 
23      SECTION 7.  This Act shall take effect upon its approval.
 

 
Page 7                                                     1812
                                     H.B. NO.           
                                                        
                                                        

 
 1 
 
 2                           INTRODUCED BY:  _______________________
 
 3 
 
 4 
 
 5                                           _______________________
 
 6 
 
 7                                           _______________________
 
 8 
 
 9                                           _______________________
 
10 
 
11                                           _______________________
 
12 
 
13                                           _______________________
 
14 
 
15                                           _______________________
 
16 
 
17                                           _______________________
 
18 
 
19                                           _______________________
 
20 
 
21                                           _______________________
 
22 
 
23                                           _______________________
 

 
Page 8                                                     1812
                                     H.B. NO.           
                                                        
                                                        

 
 1 
 
 2                                           _______________________