S.B. 1196 Summary

• Amends Hawaii's organic foods production tax credit (HRS 235-110.94) to align with federal law under the Organic Foods Production Act (7 U.S.C. §6501 et seq.).

• Expands the definition of "qualified taxpayer" to include small farmers exempt from federal organic certification requirements under 7 U.S.C. §6505(d), whose gross organic sales are $5,000 or less annually.

• Allows exempt organic farming operations to claim the tax credit without obtaining formal USDA certification, provided they comply with organic production and handling requirements.

• Requires exempt organic operations to provide an annual letter from their certifier confirming good standing and full compliance with applicable organic production, handling, and labeling requirements.

• Effective upon approval and applies to taxable years beginning after December 31, 2016.