HI HB798

Removes the "primary purpose of which is to produce income" standard from Hawaii's general excise tax (GET) exemption for nonprofit organizations and replaces it with the federal "unrelated trade or business" definition from Internal Revenue Code Section 513.

Exempts fundraising income generated by tax-exempt nonprofit organizations from Hawaii's general excise tax, aligning state law with federal income tax treatment where fundraising is not considered unrelated business income.

Retains general excise tax on gross income derived from unrelated trade or business activities, excluding modifications to unrelated business taxable income under IRC Section 512(b)(3).

Applies to charitable, religious, educational, scientific, communal, and social welfare organizations, as well as hospitals, infirmaries, sanitaria, and potable water companies that register with the Department of Taxation.

Effective date: June 30, 3000 (note: appears to contain a typographical error in the effective date).