HOUSE OF REPRESENTATIVES

H.B. NO.

831

TWENTY-SIXTH LEGISLATURE, 2011

 

STATE OF HAWAII

 

 

 

 

 

 

A BILL FOR AN ACT

 

 

relating to the general excise tax.

 

 

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

 


     SECTION 1.  Section 237-31, Hawaii Revised Statutes, is amended to read as follows:

     "§237-31  Remittances.  (a)  [All] Except as provided in subsection (b), all remittances of taxes imposed by this chapter shall be made by money, bank draft, check, cashier's check, money order, or certificate of deposit to the office of the department of taxation to which the return was transmitted.  The department shall issue its receipts therefor to the taxpayer and shall pay the moneys into the state treasury as a state realization, to be kept and accounted for as provided by law; provided that:

     (1)  The sum from all general excise tax revenues realized by the State that represents the difference between $45,000,000 and the proceeds from the sale of any general obligation bonds authorized for that fiscal year for the purposes of the state educational facilities improvement special fund shall be deposited in the state treasury in each fiscal year to the credit of the state educational facilities improvement special fund; and

     (2)  A sum, not to exceed $5,000,000, from all general excise tax revenues realized by the State shall be deposited in the state treasury in each fiscal year to the credit of the compound interest bond reserve fund.

     (b)  Upon written request, and at the discretion of the director, a taxpayer who is a contractor, as defined in section 237-6, and licensed pursuant to chapter 444, may pay taxes owed under this chapter by negotiating for, working on, and completing construction or renovation projects for the State.  The director shall adopt rules pursuant to chapter 91 to facilitate this method of payment."

     SECTION 2.  The department of taxation, in cooperation with the departments of commerce and consumer affairs and accounting and general services, and the state procurement office, shall adopt rules pursuant to chapter 91, Hawaii Revised Statutes, to allow taxpayers who are contractors to pay their general excise tax liability by working on and completing construction and renovation projects for the State.

     The rules adopted shall implement the following requirements:

     (1)  The contractor must be licensed pursuant to chapter 444, Hawaii Revised Statutes;

     (2)  Eligible construction or renovation projects shall either:

         (A)  Have received inadequate responses to invitations for bids or requests for proposals; or

         (B)  Be valued at no more than $25,000;

     (3)  In order to constitute payment of general excise tax liability, the contractor shall complete the project to the satisfaction of inspectors and standards established; and

     (4)  If the taxpayer fails to complete the project or becomes unlicensed, the taxpayer shall:

         (A)  Owe the full amount of the general excise tax liability; and

         (B)  Be liable for the costs of the entire project.

     The department of taxation shall submit a report on its progress in adopting rules and policies for the purposes of this Act, including any proposed legislation, to the legislature no later than twenty days prior to the convening of the 2012 regular session.

     SECTION 3.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 4.  This Act, upon its approval, shall apply to taxable years beginning after December 31, 2010.

 

INTRODUCED BY:

_____________________________

 

 


 


 

Report Title:

General Excise Tax; Contractors

 

Description:

Allows contractors to pay general excise tax liability by working on and completing construction or renovation projects for the State.

 

 

 

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