HI HB183

Exempts qualified small businesses engaged in manufacturing from Hawaii's general excise tax for a maximum period of five years on gross proceeds of sales of manufactured products.

Defines "manufacturing" as producing, preparation, propagation, or processing of products from natural substances, excluding packaging and labeling unless completed by original manufacturers.

Requires qualified small businesses to employ at least three employees earning middle-income level salaries as defined by the Department of Business, Economic Development, and Tourism.

Requires qualified small businesses to meet small business criteria established by the Department of Business, Economic Development, and Tourism and obtain a tax clearance certificate from the Department of Taxation verifying compliance with filing and payment obligations.

Effective date is January 1, 2012, with the Director of Taxation authorized to adopt implementing rules.