HB 2368 Summary

• Establishes a new 10% general excise tax reduction for eligible businesses located in Hawaii for 5+ consecutive years with at least 75% Hawaii resident employees, effective July 1, 2011 through June 30, 2015.

• Increases general excise tax rates by 1% (from 4% to 5%) and use tax rates by 1% (from 4% to 5%) for taxable years 2011-2016 on sales, contracting, services, amusements, and tangible property.

• Increases the refundable food/excise tax credit amounts for low-income residents, raising the credit per exemption by $15-$25 across all income brackets.

• Phases out the corporation income tax over four years, reducing rates by approximately 25% annually for taxable years 2011-2013, with complete elimination beginning in 2014 for corporations, regulated investment companies, and real estate investment trusts.

• Takes effect July 1, 2010, with most provisions applying to taxable years beginning after December 31, 2010.