STAND. COM. REP. NO. 2611

Honolulu, Hawaii

RE: S.B. No. 2547

S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Thirty-Second State Legislature

Regular Session of 2024

State of Hawaii

Sir:

Your Committees on Labor and Technology and Health and Human Services, to which was referred S.B. No. 2547 entitled:

"A BILL FOR AN ACT RELATING TO TAXATION,"

beg leave to report as follows:

The purpose and intent of this measure is to establish income tax credits for employers who offer employer-provided or employer-sponsored child care services for their employees.

Your Committees received testimony in support of this measure from Retail Merchants of Hawaii; NFIB, Hawaii Chapter; Chamber of Commerce Hawaii, Society of Human Resource Management Hawaii, and one individual.

Your Committees received comments on this measure from Department of Taxation and Tax Foundation of Hawaii.

Your Committees find that working parents in Hawaii have a difficult time balancing their professional responsibilities with the care and nurturing of their children. Your Committees also find that lack of sufficient childcare is a major barrier for entry or reentry into the workforce. This measure will incentivize employers to provide a safe child care environment at the workplace or subsidize the cost their employees bear for child care during workhours, thereby helping employees better balance their work and family responsibilities.

Your Committees have amended this measure by:

(1) Clarifying that the prorated tax credit for the costs of qualified child care property purchased and acquired by employers to provide child care facilities on their premises that is in excess of the employer's net income tax liability for the taxable year shall not be carried forward;

(2) Clarifying that the information to ensure that the tax credits under this measure are granted only to eligible taxpayers, that must be included in the written sworn statement submitted by a taxpayer claiming the tax credit to the Department of Taxation, shall be set forth in rules adopted by the Department of Human Services; and

(3) Inserting an effective date of July 1, 2050, to encourage further discussion.

As affirmed by the records of votes of the members of your Committees on Labor and Technology and Health and Human Services that are attached to this report, your Committees are in accord with the intent and purpose of S.B. No. 2547, as amended herein, and recommend that it pass Second Reading in the form attached hereto as S.B. No. 2547, S.D. 1, and be referred to your Committee on Ways and Means.

Respectfully submitted on behalf of the members of the Committees on Labor and Technology and Health and Human Services,

________________________________ JOY A. SAN BUENAVENTURA, Chair

________________________________ HENRY J.C. AQUINO, Chair