THE SENATE	S.B. NO.	1239
THIRTY-SECOND LEGISLATURE, 2023
STATE OF HAWAII

A BILL FOR AN ACT

relating to general excise tax.

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

SECTION 1. The legislature finds that Hawaii has the highest cost of living in the nation. The general excise tax is levied on nearly every economic activity, which, due to the highly regressive structure of the tax, disproportionately affects low-income and middle-class families. Although businesses are required to pay general excise taxes out of their gross receipts, those taxes are passed on to customers in the form of higher prices. Because the general excise tax affects almost all areas of economic activity, it can make it difficult for average families to afford basic life expenses, such as medical services, food, and housing.

The purpose of this Act is to exempt certain medical services, food, and rent from the general excise tax.

SECTION 2. Chapter 237, Hawaii Revised Statutes, is amended by adding three new sections to be appropriately designated and to read as follows:

"§237-   Exemption for medical services. (a) There shall be exempted from, and excluded from the measure of, the taxes imposed by this chapter, all of the gross proceeds arising from the sale of medical services.

(b) As used in this section, "medical services" includes those services provided within hospitals, medical clinics, and private medical practices that are performed by a person licensed under chapter 436E, 442, 447, 448, 448B, 451A, 451J, 451K, 452, 453, 453D, 455, 457, 457A, 457G, 458, 459, 461, 461J, 463E, 465, 465D, 466D, 466J, or 468E.

§237-   Exemption for sales of food. There shall be exempted from, and excluded from the measure of, the taxes imposed by this chapter, all gross proceeds or income arising from the sale of Supplemental Nutrition Assistance Program-eligible items; provided that soft drinks shall not be exempted by this section.

§237_   Exemption for rental payments. There shall be exempted from, and excluded from the measure of, the taxes imposed by this chapter, all gross proceeds arising from the rental of residential real property."

SECTION 3. New statutory material is underscored.

SECTION 4. This Act shall take effect on July 1, 2023.

INTRODUCED BY:

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Report Title:

General Excise Tax; Exemption; Medical Services; Supplemental Nutrition Assistance Program; Rent

Description:

Exempts certain medical services, food, and rent from the general excise tax.

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.