HI HB688

Exempts medical services from Hawaii's general excise tax, excluding gross proceeds from such services from the tax base under Chapter 237, Hawaii Revised Statutes.

Defines "medical services" as professional services provided by hospitals, medical clinics, and facilities licensed under specified state chapters (436E, 442, 447, 448, 448B, 451A, 451J, 451K, 452, 453, 453D, 455, 457, 457A, 457G, 458, 459, 461, 461J, 463E, 465, 465D, 466D, 466J, and 468E).

Addresses Hawaii's high cost of living by reducing the regressive tax burden on healthcare, which disproportionately affects low-income and middle-class families; 41 other states already exclude medical services from sales taxes.

Takes effect upon approval and applies to taxable years beginning after December 31, 2023.