STAND. COM. REP. NO. 3283

Honolulu, Hawaii

RE: H.B. No. 2466

H.D. 2

S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Thirty-First State Legislature

Regular Session of 2022

State of Hawaii

Sir:

Your Committee on Agriculture and Environment, to which was referred H.B. No. 2466, H.D. 2, entitled:

"A BILL FOR AN ACT RELATING TO TARO,"

begs leave to report as follows:

The purpose and intent of this measure is to exempt the gross proceeds or income received from the sale of any product resulting from the cultivation and production of unprocessed taro in the State from the general excise tax.

Your Committee received testimony in support of this measure from the Department of Agriculture, Office of Hawaiian Affairs, Hawai‘i Farm Bureau, Mahiku A‘o Mai Food Security Services, Hawai‘i Alliance for Progressive Action, Restore the Commons, Hawai‘i Food+ Policy Internship, Ko‘olaupoko Hawaiian Civic Club, and eight individuals. Your Committee received testimony in opposition to this measure from the Department of Taxation. Your Committee received comments on this measure from the Department of Budget and Finance, Department of the Attorney General, and Tax Foundation of Hawaii.

Your Committee finds that Hawaii imports a significant portion of the food consumed within the State. While the State has taken steps to increase the production of food in Hawaii, staple starches remain underproduced in the State. Your Committee believes that taro can help to fill that critical gap in Hawaii's local food production. This measure supports the expansion of local taro production by exempting unprocessed taro from the general excise tax.

Your Committee has amended this measure by:

(1) Removing a requirement that taro must be produced and cultivated in the State to qualify for the exemption;

(2) Excluding bulk buyers or shippers, supermarkets, and big box stores from the exemption; and

(3) Defining "primary ingredient".

As affirmed by the record of votes of the members of your Committee on Agriculture and Environment that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 2466, H.D. 2, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 2466, H.D. 2, S.D. 1, and be referred to your Committee on Ways and Means.

Respectfully submitted on behalf of the members of the Committee on Agriculture and Environment,

________________________________

MIKE GABBARD, Chair