HI HB389

Creates a carbon sequestration tax credit under Hawaii income tax law for taxpayers who capture and store qualified carbon oxide at industrial or direct air capture facilities in the state.

Credit amount equals a specified dollar amount per metric ton of qualified carbon oxide that is captured and permanently disposed of in secure geological storage, excluding carbon used as a tertiary injectant in oil or gas recovery.

Excess credits over a taxpayer's income tax liability may be carried forward to subsequent years until exhausted, with claims required to be filed within 12 months after the close of the taxable year.

Department of Health must adopt rules to certify the metric tons of qualified carbon oxide captured and disposed, maintain records of taxpayers claiming the credit, and issue certificates within seven months of receiving taxpayer submissions; Department of Taxation administers the credit and may audit certifications.

Effective date is July 1, 3000 (note: this appears to be a drafting error for the year 2023 or later).