HI SR127

Directs the Director of Taxation to review Hawaii Revised Statutes Section 237-25(c) to determine if there is a rational basis for its apparent disparity with other sections of Chapter 237.

Section 237-25(c) prohibits taxpayers from deducting tangible personal property furnished in conjunction with service businesses, even when separately billed, while Sections 237-14, 237-14.5, 237-18, 237-21, 237-23(a)(7), and 237-23(b)(3) allow segregation and allocation of gross proceeds to apply different tax rates.

Urges the Director to administratively suspend Section 237-25(c) if no rational basis for the disparity is found.

Requires the Director of Taxation to report findings and recommendations to the Legislature no later than 20 days before the 2014 Regular Session convenes.