HI HB2546

Eliminates the federal "base amount" calculation for Hawaii's research activities tax credit, allowing taxpayers to claim credits for all qualified research expenses without reduction for prior-year spending.

Increases the annual statewide cap for research tax credits from $5,000,000 to a new amount (left blank in the bill for legislative determination).

Replaces the first-come, first-served certification system with proportional distribution when the annual cap is reached, dividing credits among all qualified high technology businesses based on their share of total qualified research expenses claimed.

Requires the Department of Business, Economic Development, and Tourism to establish an annual application period ending March 1 at 5:00 p.m. HST, with notification to applicants of certified credit amounts by May 31.

Applies retroactively to taxable years beginning after December 31, 2024, with a placeholder effective date of July 1, 3000.