STAND. COM. REP. NO.  397

 

Honolulu, Hawaii

                , 2013

 

RE:   H.B. No. 559

      H.D. 1

 

 

 

 

Honorable Joseph M. Souki

Speaker, House of Representatives

Twenty-Seventh State Legislature

Regular Session of 2013

State of Hawaii

 

Sir:

 

     Your Committee on Economic Development & Business, to which was referred H.B. No. 559 entitled:

 

"A BILL FOR AN ACT RELATING TO ECONOMIC DEVELOPMENT,"

 

begs leave to report as follows:

 

     The purpose of this measure is to encourage innovation and the development of research and technology in Hawaii by extending the tax credit for research activities until December 31, 2017, and clarifying the method of calculating the tax credit by:

 

     (1)  Amending the definition of "qualified high technology business";

 

     (2)  Repealing existing certification requirements and establishing new reporting requirements for qualified high technology businesses that wish to claim the tax credit; and

 

     (3)  Requiring the Department of Business, Economic Development, and Tourism to conduct studies to measure the effectiveness of the tax credit and submit reports to the legislature.

 

     Oceanit; Pukoa Scientific; Navatek, Ltd.; and a concerned individual testified in support of this measure.  The Department of Taxation testified in opposition.  The Hawaii Strategic Development Corporation, Tax Foundation of Hawaii, and High Technology Development Corporation offered comments.

 

     Your Committee has amended this measure by providing a new definition for "qualified high technology business" and extending the tax credit for research activities until 2016.  Other technical, nonsubstantive changes were made for clarity, consistency, and style.

 

     As affirmed by the record of votes of the members of your Committee on Economic Development & Business that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 559, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 559, H.D. 1, and be referred to the Committee on Finance.

 

Respectfully submitted on behalf of the members of the Committee on Economic Development & Business,

 

 

 

 

____________________________

CLIFT TSUJI, Chair