Bill Text: HI HB1458 | 2025 | Regular Session | Introduced
Bill Title: Relating To Taxation Of Advertising Revenue By Major Social Media Platforms.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced) 2025-01-27 - Referred to ECD, CPC, FIN, referral sheet 4 [HB1458 Detail]
Download: Hawaii-2025-HB1458-Introduced.html
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HOUSE OF REPRESENTATIVES |
H.B. NO. |
1458 |
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THIRTY-THIRD LEGISLATURE, 2025 |
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STATE OF HAWAII |
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A BILL FOR AN ACT
relating to taxation of advertising revenue by Major Social media platforms.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. The legislature finds that major social media platforms generate significant revenue from advertising targeted at Hawaii residents, utilizing Hawaii-based content, or involving Hawaii audiences. Despite this revenue generation, these platforms often do not contribute adequately to the State's tax base. This inequity affects local businesses and the State's ability to address critical needs, such as broadband access and the sustainability of local journalism.
The legislature further finds that reliable broadband connectivity and robust local journalism are vital for community resilience, civic engagement, and economic growth. The allocation of additional revenue from corporate taxes on social media advertising income can address disparities in broadband access and strengthen journalism.
Accordingly, the purpose of this Act is to:
(1) Direct the department of taxation to apply the state corporate income tax to advertising revenue earned by major social media platforms if the revenue is derived from content created within the State or from audiences located in the State; and
(2) Allocate the revenue collected under this Act to a newly-established broadband and digital equity special fund to support the expansion of broadband access and local journalism initiatives.
SECTION 2. Chapter 206S, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:
"§206S- Broadband and digital equity special fund. (a) There is established within the state treasury
the broadband and digital equity special fund to be administered by the
department, into which shall be deposited the revenues collected under section
235- .
(b)
Moneys in the fund shall be used to:
(1) Fund initiatives of the office under this chapter to expand broadband access; and
(2) Support local journalism initiatives."
SECTION 3. Chapter 235, Hawaii Revised Statutes, is amended by adding a new section to part IV to be appropriately designated and to read as follows:
"§235- Taxation
of revenue derived from advertising on major social media platforms. (a) Notwithstanding any law to the contrary, all
major social media platforms earning advertising revenue from content created
within the State or from audiences located in the State shall be subject to the
tax under this part.
(b) The department shall adopt rules pursuant to chapter 91 to implement and enforce this section, including provisions for determining the proportion of advertising revenue subject to the tax pursuant to this section.
(c) Revenues collected under this section shall
be deposited into the broadband and digital equity special fund established
under section 206S- .
(d) As used in this section:
"Advertising revenue" means any
income generated from the sale of advertising, including but not limited to
targeted advertisements based on user data, interactions, or Hawaii-based
content or audiences.
"Major social media platform" means an online platform that:
(1) Has over one
million active users in the United States;
(2) Earns revenue
primarily from advertising; and
(3) Collects data or otherwise interacts with users located in the State."
SECTION 4. There is appropriated out of the broadband and digital equity special fund established pursuant to section 2 of this Act the sum of $ or so much thereof as may be necessary for fiscal year 2025-2026 and the same sum or so much thereof as may be necessary for fiscal year 2026-2027 for the purposes of the special fund.
The sums appropriated shall be expended by the department of business, economic development, and tourism for the purposes of this Act.
SECTION 5. New statutory material is underscored.
SECTION 6. This Act shall take effect on July 1, 2025.
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INTRODUCED BY: |
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Report Title:
DBEDT; Hawaii Broadband and Digital Equity Office; Broadband and Digital Equity Special Fund; Corporate Income Tax; Advertising on Major Social Media Platforms; Appropriation
Description:
Directs the Department of Taxation to apply the state corporate income tax to advertising revenue earned by major social media platforms if the revenue is derived from content created within the State or from audiences located in the State. Establishes the Broadband and Digital Equity Special Fund to receive those revenues to fund initiatives expanding broadband access and local journalism initiatives. Appropriates funds.
The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.
